Behavioral Corporate Finance

About

Traditional corporate finance assumes that managers and investors are rational and that capital markets are efficient. This is, however, often not the case. The behavioral approach to corporate finance relies on evidence from psychology in terms of personality traits and cognitive biases affecting the behavior of agents. Behavioral Corporate Finance complements the traditional corporate finance models and provides the bridge – fills the gap – between the standard corporate finance textbook and empirical observations from the real business world.

Behavioral Corporate Finance identifies the key psychological obstacles to optimal behaviour and provides guidelines to mitigate own obstacles and exploit other agents’ obstacles in relation to

capital budgeting
valuation
M&A
real options
capital structure
corporate governance
corporate internationalization
Thus, Behavioral Corporate Finance teaches students to use tools from corporate finance in a real-world setting where behavioral aspects related to personality traits and cognitive biases influence decision-making.

Course leader

Tom Aabo

Target group

Master's Level

Fee info