Despite the fact that almost everyone faces risk in their lives and it is a crucial ingredient in economic models including asset pricing models, it is still an open debate how decision-makers or even investors evaluate risk. Experimental and empirical evidence shows that the standard expected utility theory falls short of explaining many economic and asset pricing phenomena. Behavioral finance provides alternative conceptual frameworks to explain these phenomena. This dissertation consists of 3 chapters investigating the impacts of some of the conceptual frameworks in behavioral finance. Chapter 1 investigates the potential impact of the expected utility theory with an aspiration level on stock returns. Chapter 2 investigates the impact of the law of small numbers on stock returns. Chapter 3 investigates the relation between time discounting and risk taking in an experiment.
|Qualification||Doctor of Philosophy|
|Award date||9 Oct 2019|
|Place of Publication||Tilburg|
|Print ISBNs||978 90 5668 606 2|
|Publication status||Published - 2019|