“Economics is…a branch of…animal behavior.” – Walter L. Battaglia
Behavioral finance is one of the great discoveries of our time, and the University of Chicago professor and investment manager Richard Thaler is one of its principal discoverers. Misbehaving is Thaler’s personal account of his discoveries, which influence the way assets are managed, policy is conducted and economic theory is understood and taught.
Behavioral finance is the idea that investors do not act like the rational optimizers and profit maximizers that neoclassical economics assumes them to be. (Behavioral economics, a related field also closely linked to Thaler, studies irrational behavior in the real economy.)
“The Inventor of Behavioral Finance Looks Back,” Advisor Perspectives, June 23, 2015.
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