This thesis contains four chapters presenting theory and empirical evidence for two distinct aspects of human behaviour: social learning and motivated beliefs. I develop a simple theory to revisit the classical social learning models by challenging the assumption of freely available information. My model suggests that when it is costly to acquire information, social learning (herding) is prevalent, and people do not have incentives to acquire private information (e.g. to form their own judgements). Classical information cascade models suggest that although herding is observed, information aggregation is still possible with communication channels (e.g. a survey); however, my model indicates that information aggregation is unattainable because people in the herd do not acquire private information. We then test my model in a laboratory and find that, as predicted, subjects can learn from others successfully. Also, individual heterogeneity exists in: there are herd animals biased against private information, lone wolves who are biased toward it and subjects who behave optimally. In aggregate, there is no overall bias for or against private information. We also document a new cognitive bias involved in processing social information. Individual characteristics, especially the cognitive ability, seems to be a very good indicator of subjects' behaviour. Subjects with higher cognitive scores choose optimal information more frequently and follow information more frequently. Overconfidence can be driven by the consumption motive (e.g. savouring future payoff/self-image) and the instrumental motive (e.g. being optimistic about the outcome of effort for motivation). I develop a simple model incorporating these two motives and suggest that individuals hold a dynamic pattern of overconfidence. Then I conduct an online field experiment with students to test the theory. The experimental findings indicate that students are likely to adopt overconfident beliefs as a commitment device to deal with their self-control problem. However, I do not find evidence for the consumption motive of overconfidence.

Background: For the past 30 years, the neoclassical finance has been questioned bybehavioural finance. The main difference is behavioural finance ́s ability to explain a behaviour that deviate from rationality. One of the major biases within behavioural finance is overconfidence. Overconfident behaviour describes an investor with too strong belief in their own ability. This bias is not well-examined within behavioural finance in Sweden. The consequences of overconfidence are the investor ́s overvaluation skills which in turn leads to unnecessary risk-taking, excessive trading and economic losses. Purpose: The purpose of this thesis is to investigate if the overconfident bias exists among Swedish private investors. A study if the demographic factors; gender, age, marital status, education, and experience effect the level of overconfident behaviour. Further, an investigation to identify industries overconfident investors prefer or despise. Method: Our study use a deductive approach with a quantitative research. From the basis of previous studies, five hypotheses explaining a relation between demographic factors and overconfidence have been formulated. The data is collected through an online survey, published in finance forums between 2020-03-10 to 2020-03-22 which gave 233 participants. A binary logistic model was performed in STATA to examine if the hypothesis should be rejected or not. Conclusion: The findings from our study show presence of overconfidence among Swedish private investors. Statistically significant results confirm that gender, age, education, and experience have an impact on overconfident behaviour. Men are more overconfident than women, younger investors act more overconfident, higher education increase overconfidence, and more experienced investors are more overconfident.

Anand M. Goel and Anjan V Thakor 於最近的財務學刊中提出理性且風險趨避的經理人會放棄部分正報酬但風險高的投資，造成投資不足問題，使得公司價值未能極大化。然而，極端過度自信的經理人投資正負報酬皆有的計畫，造成過度投資，使得公司價值遞減。只有中度自信的經理人能為公司價值帶來極大化效果。本篇研究採用台灣上市櫃公司近二十年資料，以公司經理人對公司持股的變化來衡量其過度自信的程度，探討公司經理人自信程度對公司獲利能力與公司價值的影響。實證研究發現，極端過度自信的經理人與極端保守的經理人使公司的績效與成長性減少，降低公司價值。此研究增加我們了解經理人自有特徵對公司價值的影響，並為公司理財課題帶來新的貢獻。 / Former literature theorized that excessively overconfident CEOs and excessively diffident CEOs reduce the firm value for underinvestment and overinvestment problems and moderate overconfident CEOs willing to take risky but positive NPV projects increase the firm value. This paper conducts an empirical research by using the change of purchase and sale on own company stocks took by CEOs to measure CEO overconfidence level in Taiwanese listing companies and find that the profitability and stock performance of firms led by excessively overconfident CEOs and excessively diffident CEOs decrease compared to by moderate overconfident CEOs. The result contributes to the understanding of the impact on firm valuation by CEO idiosyncratic characteristics and offers new evidence to behavior finance on corporate management.