Cognitive Biases in the Capital Investment Context

1. Front Matter

   Pages 1-15

   PDF

2. Introduction

   • Sebastian Serfas

   Pages 1-6

3. Theoretical Foundations of Capital Investments and Investment Appraisal

   • Sebastian Serfas

   Pages 7-38

4. Theoretical Foundations of Cognitive Biases

   • Sebastian Serfas

   Pages 39-94

5. Cognitive Biases in the Capital Investment Context

   • Sebastian Serfas

   Pages 95-189

6. Debiasing and Potential Countermeasures against Cognitive Biases

   • Sebastian Serfas

   Pages 191-209

7. Conclusion

   • Sebastian Serfas

   Pages 211-219

8. Back Matter

   Pages 221-255

   PDF

In today’s competitive business environment, an optimal investment strategy is vital for every company. However, it is often endangered by unconscious mental biases inherent in every human being. Building on findings from cognitive psychology research, Sebastian Serfas shows in detail that and how these so-called cognitive biases systematically affect and distort capital investment-related decision making and business judgements. He provides a large number of examples that every business practitioner might encounter every day, demonstrates the detrimental effects through various empirical experiments, and outlines potential counterstrategies to mitigate these negative effects.

• Business psychology
• Decision theory
• Investment theory
• Management accounting
• Unconscious factors

Dr. Sebastian Serfas completed his doctoral thesis under the supervision of Prof Dr. Uwe Götze at Chemnitz University of Technology. He conducts research at the intersection of psychology and business administration and works for a leading management consultancy.

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