Abstract
Behavioural economics currently addresses the human insights that are missing from classic economic theory such as: heuristics, framing and market inefficiencies. As people are prone to economic decision-making errors it is imperative to pay attention and to examine cognitive, emotional and subjective factors that can influence the decision-making process. An area related to behavioural economics is that of behavioural finance which attempts to explain the set of psychological aspects and biases that affects financial decisions. The current research explores the influence context effects have on the economic decision making process in two different situations: crisis and no-crisis. A context effect is an aspect of cognitive psychology that describes the influence of environmental factors on one's perception of a stimulus and can have an important impact on our decisions. The paper finds that once the crisis has occurred, Romanians were influenced by the negative economic context, so a context effect could be observed. The financial decisions as regard to loans and deposits were also influenced by the interest rate level and earnings
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
More From: International Journal of Academic Research in Accounting, Finance and Management Sciences
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.