Inefficient Markets: An Introduction to Behavioral Finance (Clarendon Lectures in Economics)

Andrei Shleifer (Professor of Economics, Harvard University)

ISBN 10: 0198292279 / ISBN 13: 9780198292272

Editore: Oxford University Press, United Kingdom, Oxford, 2000

Riguardo questo articolo

The efficient markets hypothesis has been the central proposition in finance for nearly thirty years. It states that securities prices in financial markets must equal fundamental values, either because all investors are rational or because arbitrage eliminates pricing anomalies. This book describes an alternative approach to the study of financial markets: behavioral finance. This approach starts with an observation that the assumptions of investor rationality and perfect arbitrage are overwhelmingly contradicted by both psychological and institutional evidence. In actual financial markets, less than fully rational investors trade against arbitrageurs whose resources are limited by risk aversion, short horizons, and agency problems. The book presents and empirically evaluates models of such inefficient markets. Behavioral finance models both explain the available financial data better than does the efficient markets hypothesis and generate new empirical predictions. These models can account for such anomalies as the superior performance of value stocks, the closed end fund puzzle, the high returns on stocks included in market indices, the persistence of stock price bubbles, and even the collapse of several well-known hedge funds in 1998. By summarizing and expanding the research in behavioral finance, the book builds a new theoretical and empirical foundation for the economic analysis of real-world markets. The book has been read, but is in excellent condition. Pages are intact and not marred by notes or highlighting. The spine remains undamaged.

Codice articolo GOR001966247

Dati bibliografici

• Titolo: Inefficient Markets: An Introduction to Behavioral Finance (Clarendon Lectures in Economics)
• Editore: Oxford University Press, United Kingdom, Oxford
• Data di pubblicazione: 2000
• Lingua: Inglese
• ISBN 10: 0198292279
• ISBN 13: 9780198292272
• Rilegatura: Paperback
• Condizione: Very Good
• Peso: 281 grammi

Descrizione articolo

Riassunto

The efficient markets hypothesis has been the central proposition in finance for nearly thirty years. It states that securities prices in financial markets must equal fundamental values, either because all investors are rational or because arbitrage eliminates pricing anomalies.

This book describes an alternative approach to the study of financial markets: behavioral finance. This approach starts with an observation that the assumptions of investor rationality and perfect arbitrage are overwhelmingly contradicted by both psychological and institutional evidence. In actual financial markets, less than fully rational investors trade against arbitrageurs whose resources are limited by risk aversion, short horizons, and agency problems. The book presents and empirically evaluates models of such inefficient markets.

Behavioral finance models both explain the available financial data better than does the efficient markets hypothesis and generate new empirical predictions. These models can account for such anomalies as the superior performance of value stocks, the closed end fund puzzle, the high returns on stocks included in market indices, the persistence of stock price bubbles, and even the collapse of several well-known hedge funds in 1998. By summarizing and expanding the research in behavioral finance, the book builds a new theoretical and empirical foundation for the economic analysis of real-world markets.

Informazioni sull'autore

Andrei Shleifer is Professor of Economics at Harvard University