the.com/behavioral finance
the field where economists finally admit humans are not spreadsheets with legs.
means the study of how psychology, emotion, and cognitive bias systematically distort financial decisions away from rational self-interest.
from emerged in the late 1970s when psychologists daniel kahneman and amos tversky's prospect theory crashed the party of classical economics, proving people fear losses roughly twice as much as they enjoy equivalent gains.
nobel prizekahneman won 2002, thaler won 2017
loss aversionlosing 100 dollars hurts more than winning 100 feels good
herd behaviorexplains bubbles better than any equation does
nudge theorythaler's idea now shapes government policy worldwide