From the Efficient Market Hypothesis to Behavioral Finance: How Investors' Psychology Changes the Vision of Financial Markets

14 Pages Posted: 15 Sep 2008  

Adam Szyszka

Warsaw School of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: November 17, 2007

Abstract

This paper confronts the main foundations of the neoclassical theory of the capital market and asset pricing with allegations of behavioral finance. Cornerstones of the traditional theory are discussed in the first section. It is followed by a brief presentation of the behavioral approach. Further, the paper discusses consequences of the new view of finance to capital market practitioners - investors, corporate finance, and policy-makers. The paper concludes with final remarks and some thoughts on the future development of the capital market theory.

Suggested Citation

Szyszka, Adam, From the Efficient Market Hypothesis to Behavioral Finance: How Investors' Psychology Changes the Vision of Financial Markets (November 17, 2007). Available at SSRN: https://ssrn.com/abstract=1266862 or http://dx.doi.org/10.2139/ssrn.1266862

Adam Szyszka (Contact Author)

Warsaw School of Economics ( email )

Al. Niepodległości 164
Warszawa, 02-554
Poland

HOME PAGE: http://www.adamszyszka.pl

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