Selfishness And Altruism - Dr. Bryan Foltice Podcast Explains Forces In Decision-Making

In today's episode, we delve into the intriguing interplay between selfishness and altruism in the realm of decision-making and its impact on financial choices.

Behavioral finance helps us understand how financial decisions around things like investments, payments, risk, and personal debt, are greatly influenced by human emotion, biases, and cognitive limitations of the mind in processing and responding to information.

It's important to understand behavioral finance because analyzing this theory allows professionals to understand why individuals make certain decisions with their finances and how these decisions affect the economy. Professionals can use behavioral finance concepts to explain to customers the difference between a rational business decision and one that considers personal bias and impartial tendencies.

By understanding how and when people deviate from rational expectations, behavioral finance provides a blueprint to help us make better, more rational decisions when it comes to financial matters.

Behavioral finance shows that individuals may not necessarily make decisions on the basis of a rational analysis of all the information. This can lead to movements away from a fair price for an individual company’s shares, and the market as a whole to a period where share prices are collectively very high or low.

Clicking the timestamps below for a quick view of every action.

00:00 Introduction 
03:58 3 Games - Game 1 - Ultimatum Game
07:55 3 Games - Game 2 - Dictator Game 
08:57 3 Games - Game 3 - Trust Game 
12:48 If you were Fully Rational, What are the Amounts You would Give in these Games? 
16:41 Altruism Defined - Selfless concern of the Well-Being of Others
17:20 Do Fully Rational People Tip at an American Restaurant? 
26:20 Who are the Most Selfish and Altruistic Groups of People? 
28:16 What's the right balance (selfish vs. selfless) with our Money? 
30:00 Growing Up with a Scarcity Mindset to Tithing Money

I hope you enjoy the content and learn all about the topic of Behavioral Finance. I've set up the first few podcasts as mini-lectures of my Behavioral Finance course that I teach at Butler University each semester. The goal of this podcast is to provide a comprehensive look into the topic of Behavioral Finance - for free!

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