Economics 207BF - Behavioral Economics

Empirical research has located serious flaws in;the concept of rational economic decision making;and efficient markets. The evidence indicates;that actual decision makers and markets deviate;from expected rational outcomes frequently enough;to require rethinking of the way decision makers;think and markets behave, including unexpected;market crashes and sustained market bubbles. This;course is designed to examine new theoretical;work that seeks to provide more accurate;predictions of market behavior, improved;assessments of underlying risk to portfolio;holders, and better estimates of the underlying;value of securities.

Prereq: Not open to first-year students in their first semester.