Behavioural and experimental finance


PGE 3A -Finance (FIN)
Seminars in Finance
Contact hours
22 H
Number of spots
Open to visitors
Nicolas EBER

Pedagogical contribution of the course to the program

LEARNING GOAL 1 : Students will master state-of-the-art knowledge and tools in management fields in general, as well as in areas specific to the specialized field of management.

Students will identify a business organization’s operational and managerial challenges in a complex and evolving environment.
Students will understand state-of-the-art management concepts and tools and use them appropriately.
Students will implement appropriate methodologies to develop appropriate solutions for business issues.
LEARNING GOAL 2 : Students will develop advanced-level managerial skills.
Students will participate in a decision-making process in a critical way.
LEARNING GOAL 4: Students will study and work effectively in a multicultural and international environment.
Students will demonstrate written and oral competency in two foreign languages.
Students will analyze business organizations and problems in a multicultural and international environment


Presentation PART I: Psychological Foundations of Behavioral Finance (Prof. EBER) During the sessions, each student participates to survey experiments via the Moodle platform. The class consists of (i) experimental surveys students answer, and (ii) post-experiment discussions of the ideas highlighted by the surveys. PART II: Behavioral Finance (Profs. MERLI/ROGER) Conventional (or standard) financial theory relies on strong assumptions, for example perfect rationality of investors. An accumulating body of research challenges these fundamental assumptions, suggesting instead that decisions are motivated by a complex array of rational and non-rational psychological factors. This part explores financial decision making in the real world populated by real people.

Teaching methods


- Lectures

In group

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- Discussions/debates
- Games (educational, role play, simulation)


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Learning objectives

Cognitive domain

Upon completion of this course, students should be able to
  • - (level 1) Present the psychological foundations of behavioral finance and economics
  • - (level 2) Explain the main concepts of psychology applied to finance and economics
  • - (level 2) Discuss the insights and the limits of the psychological approach of finance
  • - (level 2) Discuss the links between behavioral and standard finance
  • - (level 3) Apply the principles highlighted by the experiments
  • - (level 4) Criticize and improve the analysis of financial behavior and financial markets
  • - (level 6) Assess the insights from the psychological approach in finance

Affective domain

Upon completion of this course, students should be able to
None affective domain have been associated with this course yet


PART I: Psychological Foundations of Behavioral Finance 5 topics/experimental sessions: 1. Bounded Rationality 2. Heuristics and Biases 3. Overconfidence and Overoptimism 4. Present Bias 5. Risk Aversion, Loss Aversion, and Ambiguity Aversion PART II Behavioral Finance II1 / Foundations and key concepts Anomalies, Heuristics and Biases, behavioral aspects of asset pricing II2 / Portfolio management: behavioral approaches

No prerequisite has been provided

Knowledge in / Key concepts to master

Principles of finance

Teaching material

Mandatory tools for the course

- Computer
- Calculator

Documents in all formats

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Moodle platform

- Upload of class documents


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Additional electronic platforms

No items in this list have been checked.

Recommended reading

Barberis, N. and . Thaler, A Survey of behavioral finance, Working Paper 9222 Barber, B., and T. Odean,, The behavior of individual investors, Handbook of the Economics of Finance, 2013, Bake, H.K and R. Nofsinger, Behavioral Finance: Investors, Corporations and Markets, KOLB series in Finance, 2010 Eber. N. [2020], , La psychologie économique et financière, De Boeck. (In French!)

Gilboa. I [2011], Rational Choice, MIT Press. Gilboa. I [2011], Making Better Decisions: Decision Theory in Practice, Wiley-Blackwell. Kahneman, D. [2011], Thinking, Fast and Slow, Farrar, Straus and Giroux.

EM Research: Be sure to mobilize at least one resource

Textbooks, case studies, translated material, etc. can be entered
Boolell-Gunesh, S., Broihanne, M_H, M. Merli. "Sophistication of Individual Investors and Disposition Effect Dynamics", Finance, Vol. 1, n° 33, 2012 Broihanne, M-H., M. Merli and P. Roger "Overconfidence, Risk Perception and the Risk-Taking Behavior of Finance Professionals ", (with), Finance Research Letters, Vol. 2, n° 11, 2014 Eber. N. [2020], , La psychologie économique et financière, De Boeck. (In French!) Magron, C. and M. Merli, Repurchase behavior of individual investors, sophistication and regret", (with C. Magron), Journal of Banking and Finance, Vol. 61, December 2015 Roger, P., T. Roger and A. Schatt, "Behavioral bias in number processing: Evidence from analysts' expectations ", Journal of Economic Behavior and Organization, Vol. 149, 2018, 315-331


List of assessment methods

Final evaluationExam week
Written (90 Min.) / Individual / English / Weight : 100 %
This evaluation is used to measure LO1.1, LO1.2, LO1.3
No assessment methods have been attributed to this course yet.