19min chapter

Masters in Business cover image

Advancing Behavioral Economics with Colin Camerer

Masters in Business

CHAPTER

Understanding Risk Aversion and Behavioral Finance

This chapter explores the concept of risk aversion with a specific focus on loss aversion, supported by a comprehensive meta-analysis of behavioral finance studies. It examines the effects of neurological conditions on decision-making, particularly how amygdala damage can lead to increased risk-taking in financial strategies. The chapter also highlights the relationship between emotional regulation and trading success, alongside a discussion of autism spectrum traits in relation to investing behaviors.

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