How behavioral economics can elevate strategic risk management

Cognitive biases, such as a herd mentality, can lead to excessive risk-taking.
  • 18 December 2017

The announcement that yet another behavioral economist, Richard Thaler, won this year’s Nobel Prize in Economics has far-reaching implications for firm risk-taking. Daniel Kahneman, Robert Shiller and now Thaler have brought significant credibility to the area of behavioral economics by demonstrating how inherent biases can affect economic decisions. While much of their research has focused on biases and traits that affect investment decisions, their collective work can be leveraged to improve the way senior management views and takes strategic risks.

Read more