Behavioral Finance

By Jay R. Ritter · Pacific-Basin Finance Journal · 2003

A brief introduction to behavioral finance by Jay R. Ritter, published in the Pacific-Basin Finance Journal, Volume 11, Issue 4 (September 2003). Behavioral finance encompasses research that drops the traditional assumptions of expected utility maximization with rational investors in efficient markets; its two building blocks are cognitive psychology (how people think) and the limits to arbitrage (when markets will be inefficient).

On the syllabus

Exam GI-201 — outcome 4a; sections 1-3 (pp. 429-434)

1 Introduction

2 Cognitive Biases

3 The limits to arbitrage

4 Applications of behavioral finance

5 Conclusions

References

Sources

Behavioral Finance (Jay R. Ritter, author's copy of the Pacific-Basin Finance Journal article, Vol. 11, No. 4, September 2003, pp. 429-437) — the document: title, author, abstract and the section headings; the file is the author's copy, which says it was "published, with minor modifications" in the journal, so its layout and page numbers are not the journal's (13 pages, sha256 bb9e699fa38301e9...); its bookmarks are not the paper's headings and were not used
Behavioral finance (Pacific-Basin Finance Journal, ScienceDirect) — the journal's record of the article, which the syllabus links; it could not be opened from here
GI 201 Syllabus, Nov 2026/Mar 2027 (SOA) — the citation (Volume 11, Issue 4, Sep 2003), the sections and pages assigned and the learning outcome