IDEAS home Printed from https://ideas.repec.org/a/sae/jinter/v5y1994i1p55-62.html
   My bibliography  Save this article

Information and the Psychology of Investor Behaviour

Author

Listed:
  • Trevor W. Chamberlain

    (McMaster University)

  • Lewis D. Johnson

    (Queen’s University)

Abstract

In behavioural psychology the relationship between the information provided by a stimulus and an individual’s reaction thereto is widely accepted as parabolic and commonly referred to as a Wundt curve. The present paper invokes this relationship in order to examine the apparent failure of the efficient markets model as a paradigm for describing security price behaviour. Discrepancies between the prices and intrinsic values of securities are explained in terms of the amount of information entering the price determination process, with the amount required for an efficient market found to have an interior solution. The social invention of the stock market provides a convenient meeting ground in which to study the nexus between the psychology of investor behaviour and the economics of asset pricing.

Suggested Citation

  • Trevor W. Chamberlain & Lewis D. Johnson, 1994. "Information and the Psychology of Investor Behaviour," Journal of Interdisciplinary Economics, , vol. 5(1), pages 55-62, January.
    • Handle: RePEc:sae:jinter:v:5:y:1994:i:1:p:55-62
    as

    Download full text from publisher

    File URL: http://jie.sagepub.com/content/5/1/55.abstract
    Download Restriction: no
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:jinter:v:5:y:1994:i:1:p:55-62. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.