This course is intended for advanced PhD students intending to do research in economics and finance. This course will review the current state of knowledge in behavioral finance. The course will center around discussions of important papers in the academic literature. The papers will come from the finance, behavioral finance,and the experimental psychology literatures. There will also be several lectures.
Broad topics to be covered are: empirical evidence on security markets (anomalies); evidence on individual and institutional behavior; limits of arbitrage; psychology, judgment and decision making; and other related topics. The course will be designed to have as little overlap as possible with other courses in the PhD sequence.
The course grade will be based on class participation, on a small number of "referee reports," on an original research proposal, and a final exam.