Economics and finance have become topics dominated by maths and theory, with a key theory of economics being 'rational expectations' with theories predicated on rational operators. But the problem with this is it misses the point that people are emotional, and people are the ones who determine how the economy operates and how prices behave in financial markets. Indeed the emerging field of behavioral finance is honing in on this very point and attracting increasing attention. If any example illustrated the folly of human behavior in financial and economic systems, it was the global financial crisis. Simply put, in order to really understand economics and finance you must understand the impact of human psychology, emotions, and behaviour.
NOVA presents "Mind Over Money"—an entertaining and penetrating exploration of why mainstream economists failed to predict the crash of 2008 and why we so often make irrational financial decisions. The program reveals how our emotions interfere with our decision-making and explores controversial new arguments about the world of finance. In the face of the recent crash, can a new science that aims to incorporate human psychology into finance—behavioral economics—help us make better financial decisions?
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Finance Documentaries: http://www.financedocumentaries.com/2012/04/mind-over-money.html