Behavioural issues in portfolio decision analysis

Fasolo, Barbara and Morton, Alec and Winterfeldt, Detlof; Salo, Ahti and Keisler, Jeffrey and Morton, Alec, eds. (2011) Behavioural issues in portfolio decision analysis. In: Portfolio Decision Analysis. Springer-Verlag, 9781441999436, pp. 149-165.

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Abstract

The aim of this chapter is to review some behavioural issues in portfolio choice and resource allocation decisions, with a focus on their relevance to Portfolio Decision Analysis. We survey some of behavioural literature on the most common heuristics and biases that arise in and can interfere with resource allocation processes. The common idea behind this behavioural literature is that of cognitive or motivational failure as an explanation for the violation of normative models. Then, we reflect on the relevance of this literature by drawing from the authors’ personal experiences as decision maker or decision analyst in real world resource allocation settings. We argue that justifiability can also be a reason for the normative violations. We conclude by discussing ways in which an analyst might approach debiasing.

Creators(s): Fasolo, Barbara, Morton, Alec ORCID logoORCID: https://orcid.org/0000-0003-3803-8517 and Winterfeldt, Detlof; Salo, Ahti, Keisler, Jeffrey and Morton, Alec
Item type:Book Section
ID code:45439
Keywords:operations research, financial economics, management science, behavioural issues, portfolio decision analysis, Management. Industrial Management, Strategy and Management
Subjects:Social Sciences > Industries. Land use. Labor > Management. Industrial Management
Department:Strathclyde Business School > Management Science
Depositing user: Pure Administrator
Date deposited:28 Oct 2013 15:34
Last modified:02 Oct 2020 03:32
URI:https://strathprints.strath.ac.uk/id/eprint/45439
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