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Nonrational Actors and Financial Market Behavior / Richard Zeckhauser, Jayendu Patel, Darryll Hendricks.
- Format:
- Book
- Author/Creator:
- Zeckhauser, Richard.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w3731.
- NBER working paper series no. w3731
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 1991.
- Summary:
- The insights of descriptive decision theorists and psychologists, we believe, have much to contribute to our understanding of financial market macrophenomena. We propose an analytic agenda that distinguishes those individual idiosyncrasies that prove consequential at the macro-level from those that are neutralized by market processes such as poaching. We discuss five behavioral traits - barn-door closing, expert/reliance effects, status quo bias, framing, and herding - that we employ in explaining financial flows. Patterns in flows to mutual funds, to new equities, across national boundaries, as well as movements in debt-equity ratios are shown to be consistent with deviations from rationality.
- Notes:
- Print version record
- June 1991.
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