TAILIEUCHUNG - COGNITION AND ECONOMICS PART 4

HAYEK’S THEORY OF KNOWLEDGE AND BEHAVIOURAL FINANCE. All through last century, the Austrian School of Economics introduced a series of original and interesting ideas into social sciences, which are still fruitful for contemporary research. | HAYEK S THEORY OF KNOWLEDGE AND BEHAVIOURAL FINANCE Alfons Cortes and Salvatore Rizzello INTRODUCTION All through last century the Austrian School of Economics introduced a series of original and interesting ideas into social sciences which are still fruitful for contemporary research. We are not referring only to the ideas that are particularly relevant in economics such as marginal utility competition market entrepreneur time irreversibility information risk uncertainty economic cycle money theory of capital public choice to mention only the most relevant ones. What we have in mind is ideas relevant for all social sciences methodological subjectivism apriorism human knowledge human action decision making praxeology human freedom evolution nature and role of institutions. The ideas expressed by the authors belonging to this school are often so heterogeneous that they are rather a composite collection of ideas than a single consistent corpus. Nevertheless a few common aspects characterize the school as a whole. In this chapter we will examine one of the major aspects in detail. It has a paradigmatic value for the comprehension of the Austrian approach to social sciences and therefore its relevance goes beyond economic sciences. It consists in the strict connection between human mind and human decisions Cognition and Economics Advances in Austrian Economics Volume 9 87-108 Copyright 2007 by Elsevier Ltd. All rights of reproduction in any form reserved ISSN 1529-2134 doi S1529-2134 06 09004-1 87 88 ALFONS CORTES AND SALVATORE RIZZELLO a concept that has been already dealt with in literature and is here discussed with reference to investment decisions and financial decisions in general. Behavioural finance an original approach aiming at explaining financial decisions in new terms is today one of the most fruitful branches of behavioural economics and in some respects of cognitive Nevertheless a systematic study of the Austrian matrix of its .

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