10 Decision-Making Based on Behavioral Approach in the Conditions of Transformation of the Financial System

Introduction. The article analyzes the differences between traditional finance and behavioral finance. The basic tools of micro-behavioral finance are highlighted, the influence of behavioral finance on ensuring the effective result of the activity of economic relations is determined. The necessity of further study of behavioral finance in modern financial science is substantiated. It describes how behavioral finance is intended to explain the behavior of economic relations in financial market decision-making, as well as how the behavioral approach is sufficiently manifested in predicting the effects of an entity's activities today. Purpose. The methodology of work is studied in the understanding of the concept of "behavior of people", as well as their representatives on the subjects of economic dependence. Results. In recent decades, a new science has emerged and is developing - behavioral finance, which is aimed at clarifying a number of anomalies that emerge in the financial markets. Behavioral finance casts doubt on the rational behavior of market participants and examines deviations in the decision-making system. Conclusion. Assessment of the prospects of enterprise development, taking into account changes in the economy and behavioral finance is the basis for the formation of forecast data and drawing up plans. As a rule, virtually all forecasting methods are based on changes that occur from one period to another, without taking into account the behavioral factor, which allows only to predict the financial results of the enterprise while maintaining existing trends in the market environment, without taking into account possible qualitative changes and may lead to inefficient economic activity, and thus to a decrease in profit.

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An Assessment on Inflation Risk and Its Effects on Business Operations

Handbook of Research on Strategic Developments and Regulatory Practice in Global Finance - Advances in Finance, Accounting, and Economics ◽

10.4018/978-1-4666-7288-8.ch013 ◽

2015 ◽

pp. 197-216 ◽

Cited By ~ 1

Author(s):

Ümit Hacıoğlu ◽

Hasan Dinçer ◽

Burcu Parlak

Keyword(s):

Decision Making ◽

Theoretical Perspective ◽

Financial System ◽

Business Organizations ◽

Inflation Risk ◽

Business Operations ◽

The World ◽

Rank One ◽

Management Functions ◽

Financial Environment

The latest economic crisis in the world affected business operations and decision making process at management rank. One of the major components of financial system is business organizations within the financial environment, which injects cash to the system and individuals. Therefore, fluctuations in financial system regarding inflationary trends should be evaluated and risk management functions for banking operations should be facilitated. In this chapter, operating mechanism of financial system, risks, inflation and the effects of inflation on business operations have been outlined from a theoretical perspective.

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When Policies Collide: A Decision Making Framework for Financial System Overhaul in the 21st Century

SSRN Electronic Journal ◽

10.2139/ssrn.1686982 ◽

2010 ◽

Author(s):

Tim Wafa

Keyword(s):

Decision Making ◽

21St Century ◽

Financial System ◽

Decision Making Framework

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Jon Elster's Securities against Misrule: Juries, Assemblies, Elections: A Review Essay

Journal of Economic Literature ◽

10.1257/jel.53.1.65 ◽

2015 ◽

Vol 53 (1) ◽

pp. 65-78

Author(s):

David Austen-Smith

Keyword(s):

Decision Making ◽

Objective Function ◽

Review Essay ◽

Collective Decision ◽

Behavioral Approach ◽

Collective Decision Making ◽

Economic Approach ◽

Good Decision

The standard economic approach to designing institutions for collective decision making recognizes individuals' strategically rational motivations for misrepresentation and asks how best, given an objective function, to design a set of incentives and constraints to internalize or negate such motivations. Securities Against Misrule offers, in the author's phrase, an “essay in persuasion” to the effect that such an approach is fundamentally misguided. Instead, Elster argues for a behavioral approach centered on designing institutions for good decision making, rather than good outcomes, by individuals whose actions are chronically subject to emotional, self-interested, and prejudicial distortions. (JEL D02, D71, D72, D82)

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Pedestrian crossing decision-making: A situational and behavioral approach

Safety Science ◽

10.1016/j.ssci.2009.03.016 ◽

2009 ◽

Vol 47 (9) ◽

pp. 1248-1253 ◽

Cited By ~ 51

Author(s):

Brigitte Cambon de Lavalette ◽

Charles Tijus ◽

Sébastien Poitrenaud ◽

Christine Leproux ◽

Jacques Bergeron ◽

...

Keyword(s):

Decision Making ◽

Behavioral Approach ◽

Pedestrian Crossing

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Bank Lobbying

IMF Working Papers ◽

10.5089/9781484347546.001 ◽

2019 ◽

Vol 19 (171) ◽

Cited By ~ 1

Author(s):

Deniz Igan ◽

Thomas Lambert

Keyword(s):

Decision Making ◽

Empirical Evidence ◽

Political Power ◽

Financial System ◽

Economic Outcomes ◽

Decision Making Process ◽

Regulatory Capture ◽

Checks And Balances ◽

The Subject ◽

Regulatory Decisions

In this paper, we discuss whether and how bank lobbying can lead to regulatory capture and have real consequences through an overview of the motivations behind bank lobbying and of recent empirical evidence on the subject. Overall, the findings are consistent with regulatory capture, which lessens the support for tighter rules and enforcement. This in turn allows riskier practices and worse economic outcomes. The evidence provides insights into how the rising political power of banks in the early 2000s propelled the financial system and the economy into crisis. While these findings should not be interpreted as a call for an outright ban of lobbying, they point in the direction of a need for rethinking the framework governing interactions between regulators and banks. Enhanced transparency of regulatory decisions as well as strenghtened checks and balances within the decision-making process would go in this direction.

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