Have you ever made a successful trade and thought to yourself, “Yeah I knew it, I’m so great, I should start a hedge fund!”? When a couple wins in the stock market it feels like you’re ready to challenge Warren Buffett? There’s nothing wrong with being right a couple of times and winning certainly boosts […]
Loss Aversion and the Sunk Cost Trap in Venture Capital In the high-risk world of venture capital (VC), balancing the tightrope of innovation and risk is a key skill to master. Knowing when risks have reached their limits can mean the difference between cutting losses and doubling down in hopes of a future payoff. This […]
The recent work published by the 2024 Economics Nobel Prize winners has brought to light once again the role institutions play in economic development, making some countries rich and others poor. However, in modern society, it is important to consider the role behavioural economics plays in this, as acknowledged in the “World Development Report” by […]
“Which is more dangerous, a gun or a swimming pool? What do schoolteachers and sumo wrestlers have in common? How much do parents really matter?”. If these don’t sound like typical questions raised by economists, it’s because they are not. But breaking conventional wisdom by exploring the hidden patterns behind daily life occurrences is exactly […]
“Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism” (2009) is a book written by George A. Akerlof, 2001 Economics Nobel Prize winner, and Robert J. Shiller, Economics professor at Yale. In the book, the authors examine the role of emotions and human psychology in shaping economic decisions and […]
Imagine you are standing in line at a cinema to buy popcorn. As you get to the front of the stand you see that there are three size options: small, medium, and large. You are not too hungry, so you’re thinking of buying the small one. The small costs € 4, the medium € 6.50 […]
In the realm of economic theories, where choices appear as outcomes of stable preferences, Cognitive Economics introduces a novel perspective. This field, blending insights from economics, neuroscience, and cognitive psychology, seeks to unravel the mysteries of human decision-making, challenging conventional wisdom. Classical Economics assumes that choices derive from stable preferences, whereas Behavioral Economics ventures into […]
The stories of corruption within democracies have millennia-old origins; just think of the Verrines or the trial against Catiline, cases that changed the sensibilities of the time regarding the morality underlying politics. The gradual expansion of suffrage, up to its universality, are recent and significant steps that have changed the needs of democratic countries. A […]
Over centuries, countries have adopted different strategies in terms of diplomacy. From the United States’ “hard boots” approach to soft diplomacy – nations have learned how to adapt in order to foster positive relationships and enhance their image on the global stage. Over the course of the past years, strategies have evolved to incorporate behavioral […]
The expression “seasonal shopping events” or “SSEs” refers to specialized events, often related to national or religious holidays, in which retailers create shopping opportunities, by offering discounts and promotions, to attract consumers and maximize sales volume. The end of November brings two of the most relevant SSEs, Black Friday and Cyber Monday. Historically, Black Friday […]
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