economics, game theory, political
science and law. Now behavioral finance is poised to replace
neoclassical finance as the dominant paradigm of the
discipline.
Traditionally, economists model behavior in terms of
rational individual decision-makers who make optimal use
of all available information. There is ample evidence that the
rationality assumption is unrealistic. The path-breaking work
of Herbert Simon, Tversky and Kahneman, Lola Lopes, and
others on bounded rationality, judgmental heuristics, biases…
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