Hersh ShefrinSanta Clara University
Behavioral finance is the application of psychology to financial decision making and financial markets. This section consists of three chapters whose content provides perspectives and tools to facilitate the integration of psychological variables into the analysis of systemic risk.
To set the stage for the issues discussed in this part of the Handbook, consider a series of comments made by the Financial Crisis Inquiry Commission (FCIC) in connection with regulatory failures that occurred before and during the financial crisis that erupted in 2008. In its report, ...