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Behavioral Significance in the Credit Decision Making ProcessAbstract: Behavioral finance research is an attempt to close the gaps in traditional theory, to maximize the expected usefulness of rational investors in effective markets by trying to justify human behavior. A fundamental assumption in behavioral finances is that both the information structure and the characteristics of market participants systemically influence individual investment decisions as much as market results. The investor, as a human being, processes information using shortcuts and emotional filters. This process influences those who make financial decisions in such a way that they act apparently irrationally and choose decisions below the optimal threshold, in violation of effective traditional financial assumptions. The impact of this decision below the optimal threshold has ramifications for capital market efficiency, personal wealth and corporate performance. Behavioral finance focuses on how investors interpret and use information so that they make investment decisions based on real information

Author

Listed:
  • Roxana Elena CRISTEA

    (The Bucharest University of Economic Studies)

  • Petre BREZEANU

    (The Bucharest University of Economic Studies)

Abstract

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  • Roxana Elena CRISTEA & Petre BREZEANU, 2022. "Behavioral Significance in the Credit Decision Making ProcessAbstract: Behavioral finance research is an attempt to close the gaps in traditional theory, to maximize the expected usefulness of rationa," Finante - provocarile viitorului (Finance - Challenges of the Future), University of Craiova, Faculty of Economics and Business Administration, vol. 1(24), pages 40-49, November.
    • Handle: RePEc:aio:fpvfcf:v:1:y:2022:i:24:p:40-49
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    References listed on IDEAS

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    More about this item

    Keywords

    finance; analysis; behavior; credit; economic;
    All these keywords.

    JEL classification:

    • G4 - Financial Economics - - Behavioral Finance

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