The purpose of this thesis is to integrate behavioral finance with market microstructure and financial decision-making. Specifically, I focus on two issues concerning the integration of psycho-physiological mechanisms and the informational content of prices in financial markets: firstly, the role of emotions in financial decision making and how as an adaptive mechanism, they show to be more suitable for survival than pure rationality (in an economic sense); and secondly, the empirical and theoretical testing of how cognitive illusions and polysemy affect the informational content of prices.

The purpose of this thesis is to integrate behavioral finance with market microstructure and financial decision-making. Specifically, I focus on two issues concerning the integration of psycho-physiological mechanisms and the informational content of prices in financial markets: firstly, the role of emotions in financial decision making and how as an adaptive mechanism, they show to be more suitable for survival than pure rationality (in an economic sense); and secondly, the empirical and theoretical testing of how cognitive illusions and polysemy affect the informational content of prices.

The aim of this thesis was to explore the experiences of black, married, working, South African women in relation to financial decision-making processes within private households from a working-woman’s perspective. The focus was on married women in middle and senior management positions in their workplaces. Following a literature review to accumulate empirical evidence from similar studies in the areas of Economics, Sociology, Psychology, Feminism and Economic Psychology, eight, individual, semi-structured interviews were conducted with black South African women in managerial positions to establish the women’s understanding of the meaning of money, concepts and practices of sharing of monetary resources between husband and wife in the household, the allocation of money as a resource in the household, control of money between husband and wife in the household, and decision-making processes between husband and wives. The key findings of the study were: · The diverse construction of the meaning of money. Women’s views on money had an impact on how they viewed their roles in household financial management and decision-making. · The absence of equal sharing of money and the existence of breadwinning/caregiver ideologies. Three patterns of money management were identified. Joint pooling, where equality of sharing, control and decision-making was greatest, was associated with higher income levels and availability of personal spending money. The female whole wage system, with minimal control and joint decision-making, was associated only with women with high-level income and minimal personal spending money. The independent managed system was associated with completely separate money management, unequal sharing of money, increased power, inequality in decision-making, and increased personal spending money by the breadwinner. · The pattern of financial allocation adopted had an influence on control and decision-making in the household. In all the systems of financial allocation adopted, women indicated that their partners had a final say in the financial decision-making processes. The study highlights some policy implications of inequality in financial decision-making. Due to the fact that household based analysis assumes that financial decision-making is shared equally in the households, women and children will most of the time lose out when this is not the case. It was therefore recommended that a deeper understanding of household decision-making may help the policy makers and researchers alike to focus on women in a more effective way, for example, by designing empowering programmes that will assist women to be involved in the financial planning and decision making in their households. / Dissertation (MA (Research Psychology))--University of Pretoria, 2005. / Psychology / unrestricted

The study focused on examining the saving and investment behaviours of South Africans. There has been no extensive research in existing literature that has focused on this area of study. This study intends to extend the understanding of what factors contribute to the decisions individuals make about saving and investment. The primary research objective was to explore and empirically test the statistical significance of income, education and gender related to the use of suitable financial products and investigate optimal ways to save and invest. This was a quantitative study which used secondary data obtained from the Human Science Research Council database gathered through a structured questionnaire. A sample of 2,972 individuals across the country participated in and completed the survey. The results illustrated that low-income participants saved less through informal saving schemes than high-income participants, but the statistical significant difference between these groups is too small. The findings also showed that less-educated participants used predominantly more formal saving products than highly educated participants and the statistical significant difference between these groups is large. Finally, the findings highlighted that females make better investment choices than males, but the statistical significant difference between these groups is too small. This study illustrated that low savings and investment in South Africa is influenced by the type of financial products used and also demographic factors such as income, education and gender. / Mini Dissertation (MCom)--University of Pretoria, 2020. / Financial Management / MCom (Financial Management) / Unrestricted

Bakgrund: Investeringsplanering utgör en stor del av företagets totala planing. Behovet attinvestera har under senare år tilltagit. Anledningar till detta är bland annat;strukturomvandling, ökad priskonkurrens, optimism samt ökad ekonomisk aktivitet. Specifiktför tillverkningsindustrin är ökade kapacitetsbehov och nya produktionskrav.Tillverkningsindustrin är vidare investeringsintensiv och har under senare tid upplevt ett ökatinvesteringbehov.Problemdiskussion: Investeringar är ett ämne där ett brett utbud av tidigare forskningföreligger. Dock är processen ett relativt outforskat område. Förhållandena i små- ochmedelstora tillverkningsföretag är inte behandlade i någon nämnvärd omfattning, vilketinnebär att det finns en avsaknad av empirisk kunskap. När medelstora företag studeras tashänsyn till hela verksamheten och de förändringar de pådriver, därav är helainvesteringsprocessen relevant. Ser man till hela processen kan kalkylen vara av underordnadbetydelse. Detta ger grund till att klassiska kalkylmetoder inte bör fungera som endabeslutsunderlag, de kan inte tillgodose en fullständig bild av hur investeringen kan komma attpåverka företaget.Syfte: Vårt syfte med denna studie är att beskriva och förklara fallföretagensinvesteringsprocess fram till och med investeringsbeslut. Vårt syfte är vidare att beskriva ochatt förklara vilka faktorer som är av betydelse för fallföretagen vid investeringsbeslut.Metod: Vi har i uppsatsen använt oss av en induktiv ansats med en kvalitativforskningsinriktning. Vår forskningsdesign är flerfallstudie. Insamling av material har skettgenom personliga intervjuer med tre mellanstora företag i tillverkningsbranschen.Slutsats: Investeringsprocessen för de tre studerade fallföretagen var i många fall likartad.Processerna stämde inte överens med någon enskild process som tagits fram av tidigareforskare men genom att plocka olika delar från de olika processmodellerna kunde hela deinvesteringsprocesser som identifierats förklaras utifrån dessa modeller. Den finansiella faktorsom fallföretagen använde sig av för att jämföra investeringsalternativ var i samtliga fallPayback- metoden. Denna metod användes huvudsakligen på grund av dess enkelhet. Ickefinansiellafaktorer som påverkade investeringsbeslut var huvudsakligenkvalitetsförbättringar, val av leverantörer, arbetsmiljö, service samt produktivitet. / Background: The investment planning is a big part of a company's total planning. The needof investing has increased over the last years. The reason for this is for example; structuralchanges, increased price competition, optimism and increased economic activity. Increasedneed of capacity and new requirements in production are specific reasons for manufacturingcompanies. Manufacturing companies invests a lot and has experienced an increased need ofinvesting over the last years.Problem: Investments is a topic in which a wide range of previous research exists. However,the process is a relatively unexplored area. Conditions in the small-and medium-sizedmanufacturing companies are not discussed to a significant extent, which means that there is alack of empirical knowledge. When medium-sized companies are studied the entire companyis taken into account, hence, the entire investment process is relevant. Looking at the entireprocess, calculations can be of secondary importance. This tells us that classical calculationmethods should not serve as the sole factor for decision making as they can't give a fullpicture of how the investment could impact the company.Purpose: Our purpose with this study is to describe and explain the case-studie's investmentprocess until decision making. Our object is to describe and explain the factors that are takinginto account in the case companies when making investment decisions.Method: We have in this paper used an inductive approach with a qualitative researchapproach. Our research design is a multiple case-study. Collection of material has been madethrough personal interviews with one respondent at three medium sized companies in themanufacturing industry.Conclusion: The investment processes in the three studied companies were in many wayssimilar. The processes were not compatible with any single process developed by previousresearchers, but by picking different parts of the various process models the investmentprocesses identified could be explained by these models. The financial factor that the casecompanies used to compare investment options was in all cases the payback method. Thismethod was used mainly because of its simplicity. Non-financial factors affecting investmentdecisions were mainly quality improvements, selection of suppliers, service, workenvironment and productivity.

The purpose of this research was to determine if presentation format, given a particular task to be performed, would affect the decision-making process of financial decision makers. The problem motivating this study is the potential for managers to make inefficient decisions when they use reports which are presented inappropriately for a given task.

This dissertation investigates some of the factors affecting modern household finance decisions in the United States using natural experimental variation and administrative data. In Chapter 1 I estimate the effects of financial education on retirement savings decisions. Between 2007 and 2008 the U.S. Army implemented a mandatory 8 hour Personal Financial Management Course (PFMC) for new soldiers. Staggered implementation across locations and time provides quasi-experimental variation in whether an individual received the training. I find that the course has large and lasting effects on individual retirement savings in the Thrift Savings Plan, a tax-deferred account similar to a 401(k). The course doubles savings, has significant effects throughout the distribution of savings and the effects persist out to two years. The mechanism for the effects is likely a combination of both human capital and behavioral assistance. In Chapter 2 I estimate the effects of financial education on a variety of other economic behaviors. I rely on the same natural experiment as in Chapter 1 but I use individually matched credit data to estimate the effects of financial education on credit scores, credit balances for several types of accounts, monthly payments and adverse legal actions. In some areas I find that the PFMC has beneficial effects, reducing cumulative account balances (especially for automobile accounts) and aggregate monthly payments. In other areas, including credit scores, the probability of being active in the credit market and the number of adverse legal actions, the PFMC has no statistically significant effects on financial behavior. In Chapter 3 I estimate the effects of stress on financial decision-making. I use the natural variation in the casualty rates faced by individuals deploying overseas an exogenous source of stress and I measure the effects of this stress on individuals' participation in the Savings Deposit Program (SDP), a risk-free 10% annual percentage rate savings account. I find a modest and statistically significant negative relationship between the stress of casualties and SDP participation on the order of 5%. Some failures of the randomization test and the confounding effects of overall activity levels and rural locations cannot be eliminated as a source of the observed savings differences and as a result, these results should be considered suggestive evidence of the adverse effects of stress on financial decision-making.

This doctoral thesis consists of 4 self-contained chapters, bound together by their focus on household behavior and social interaction: Bargaining over Risk: The Impact of Decision Power on Household Portfolios. This paper provides an analysis of the internal financial decision-making process of households, employing a unique panel of household finances of the entire Swedish population. Exploitation of a source of exogenous variation in sex-specific labor demand reveals that the distribution of decision power among spouses is a driving force behind the aggregation of spouses’ preferences on financial decision making. Peer Effects and Academic Achievement: Regression Discontinuity Approach. The estimation of peer effects in schools has received much attention in recent years but convincing estimates are hard to produce due to self-selection. This paper overcomes this problem by employing a regression discontinuity design where student assignment into high-ability classes constitutes the source of identifying information. Domestic Equality and Marital Stability: Does More Equal Sharing of Childcare affect Divorce Risk? There is an unanimity that divorce wreaks havoc upon families in which it occurs and individuals growing up in a one-parent family are more likely to deal with term economic and social difficulties. Identifying means by which divorces can be reduced is therefore an important task from a public policy perspective and this paper investigates whether more equal sharing of childcare is successful in doing so. Do Classroom Peers Matter in an Early Tracking System? The potential for peers to affect educational achievement of students is central to many important policy debates, for instance on the impacts of ability tracking. Whether tracking affects efficiency and equality of opportunities depends on how peers enter the educational production function and this paper provides estimates of this. / <p>Diss. Stockholm : Handelshögskolan, 2014. Sammanfattning jämte 4 uppsatser</p>

This dissertation aims to address the importance of financial literacy within the capability approach framework in the context of microfinance institutions’ clients in Indonesia, by raising four main issues. The first touches on financial capability and specifically focuses on its conceptualisation, predictors, and relationship with quality of life. A participatory method was employed to understand whether financial literacy is viewed as an important element of financial capability. An index of financial capability was built to investigate factors predicting financial capability and the relationship between financial capability and quality of life. The results suggest that socio-demographic discrepancies in financial capability exist, and financial capability is relevant for the improvement of quality of life. The remaining three issues centre on the instrumental value of financial literacy. In the second part, it is proposed that financial literacy is a relevant conversion factor. Within the capability approach literature itself, there is a lack of empirical discussion on conversion factors. It can be concluded that financial literacy is associated positively with conversion rate efficiency. The third research topic examined is the role of financial literacy in household financial decision-making authority. Previous studies have used household decision-making authority as a reflection of agency, which is an important building block of the capability approach. This thesis focuses on financial decision making, which is often perceived as “difficult”, “boring”, and “full of uncertainties”. It is suggested that the relationship between financial literacy and household financial decision-making authority is complex and contingent upon various factors. The role of financial literacy in the relationship between financial decision-making authority and subjective well-being is the last topic investigated in this dissertation. While decision-making authority has been argued as a reflection of human agency and source of power within households, it can also be perceived as a burden. These two interpretations of authority lead to an unclear relationship between household financial decision-making authority and subjective well-being. While a negative relationship between household financial decision-making authority and subjective well-being can be found among those with low levels of financial literacy, a similar correlation is absent among those who score high in financial literacy. This suggests that skills are important for people to value agency.

Purpose: Retirement planning has been declining rapidly all over the world due to the shift of self-funding mechanisms, such as moving from a Defined Benefit (DB) plan to the Defined Contribution (DC) plan, where individuals are required to manage their own financial wealth. Due to this rapid shift, there has been an increase in demand for financial advisors to assist individuals with decision-making and explain complex financial concepts with the perception of guiding households to build their retirement wealth. The aim of the study is to examine the relationship between retirement planning and financial advice as a predictor for retirement adequacy to determine if the latter will have any influence in helping South Africans be financially independent when they retire. This study was compelled by the fact that no or limited prior studies have been conducted in the South African context on the relationship between financial advice and retirement planning. Design/methodology/approach: In order to investigate the relationship and influence of financial advice on retirement planning, a South African Social Attitudes Survey that was conducted in 2011 by the Human Sciences Research Council was used. The chi-square and the logistic regression statistical techniques were applied to test the study hypotheses using the data from the survey. The following hypotheses were included: H0: There is no relationship between retirement planning and financial advice. H1: There is a relationship between retirement planning and financial advice. H0: There is no relationship between socio-demographics and retirement planning. H2: There is a relationship between socio-demographics and retirement planning. H0: There is no relationship between socio-demographics and financial advice. H3: There is a relationship between socio-demographics and financial advice. Findings: The results indicate that there is a positive relationship between retirement planning and financial advice. The more individuals seek financial advice the more they tend to adequately plan for retirement. Practical implications: In view of the strong relationship between the two variables, employers, government and institutions should prioritize making financial advice an essential part of retirement planning for employees. / Mini Dissertation (MCom)--University of Pretoria, 2020. / Financial Management / MCom (Financial Management) / Unrestricted