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• Financial decisions and the knowledge illusion

  1-9

  Gyorgy Komaromi

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  277

  The author deals with those influential factors of behaviour that arise from the phenomenon of knowledge illusion originating from over-confidence. It rises from the constantly recurring fault of information process. In order to demonstrate knowledge illusion, the author takes examples from special literature, from another aspect the result is shown on the basis of questionnaires filled in by university students. He draws the conclusion that in the case of financial decisions, knowledge illusion usually makes an impression on the participants" market activity. According to this assumption knowledge illusion is one of the important and not negligible factors of financial decision-making and analysis.

• Was there a stock market bubble in Hungary?

  Gyorgy Komaromi

  Views:

  252

  Bubble is one of the most frequently used and colorful terms in economics. However, it is rarely explained in detail, most economists more or less agree on what it means. In the following paper we are going to show that the widely accepted explanation of bubble contains controversial, tautological reasoning. It is challenged from the theoretical side, but practical consequences will also be mentioned. Two questions hiding in the title above will be answered. First is to give a conceptual framework for analyzing stock prices to decide whether we can label as a bubble particular movements, upward and downward tendencies in stock prices. Second, with a coherent and consistent definition we will be able to answer the question whether there was a bubble in the Hungarian stock market between 1995-2002.