Behavioral Corporate Finance:A Synthesis and Implications in China
Wei Cui
Abstract
Wei Cui
Abstract
This paper reviews theories and evidences related to behavioral corporate finance.It describes the interactions between investors and managers of the firm,and summaries the theoretical models,analysis and empirical evidence from investors' irrationality and managers' irrationality perspective respectively.It offers intuitive and realistic explanations for capital budgeting decisions,capital structure decisions,dividend policies and etc.It also sheds lights on the solutions of the more complicated problems within and without the firm.
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This paper reviews theories and evidences related to behavioral corporate finance.It describes the interactions between investors and managers of the firm,and summaries the theoretical models,analysis and empirical evidence from investors' irrationality and managers' irrationality perspective respectively.It offers intuitive and realistic explanations for capital budgeting decisions,capital structure decisions,dividend policies and etc.It also sheds lights on the solutions of the more complicated problems within and without the firm.
Key concepts: Irrationality, Corporate finance, Dividend, Behavioral economics, Perspective (graphical), Capital structure, Economics, Dividend policy