The Neuroeconomics of Financial Decisions and the Stochastic Discount Factor

30 Pages Posted: 20 Apr 2016 Last revised: 29 Apr 2016

See all articles by Terrence R. Chorvat

Terrence R. Chorvat

George Mason University - Antonin Scalia Law School, Faculty

Date Written: April 18, 2016

Abstract

This essay argues that neuroeconomic research on financial decisions should attempt to focus on standard models that relate to the behavior being studied. It particular, it argues that a key organizing concept for such research should be the stochastic discount factor. Focusing on such models will help to focus the research as well as suggest profitable extensions of the research. The improved models will help us to better understand and craft legal rules and institutions.

Suggested Citation

Chorvat, Terrence R., The Neuroeconomics of Financial Decisions and the Stochastic Discount Factor (April 18, 2016). George Mason Law & Economics Research Paper No. 16-20. Available at SSRN: https://ssrn.com/abstract=2766378 or http://dx.doi.org/10.2139/ssrn.2766378

Terrence R. Chorvat (Contact Author)

George Mason University - Antonin Scalia Law School, Faculty ( email )

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Arlington, VA 22201
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703-993-8208 (Phone)

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