Behavioural Finance topic 8 Essay Example | Topics and Well Written Essays - 1000 words

behavioral Finance topic 8 - Essay Examplerd disagree with Koopmans as they consider reporting facts-without data assumptions through some probability model is an important scientific activity.Growth facts which came out of empirical kit and caboodle of Kuznets and some others are important in the development of sparing theory. Solow (1970, p.2) agrees that these facts led to the development of his classic result model which has become the some crucial organizing structure in macroeconomics whether we consider the issues of growth or exoteric finance or fluctuation. Solows (1970, pp.2-3) major growth factors areKydland and Edward study aimed at presenting the business cycle facts with course credit to the established neoclassical growth theory which they have used as an organizing framework. They stress that the statistics reported in their study are not measure rather they are statistics from interesting patterns in the light of neoclassical growth theory.Business cycles st udy grew during 1920s and 1940s.With the development of Koopmans structural systems of equations, it didnt remain a very alive(p) area of study. However, it is alive once again in the form of recurrent fluctuations. Lucas (1977) study proved to be instrumental in bringing business cycles study into mainstream. He defined business cycles as the deviations of congeries real output from trend. In order to complete his definition, Kydland and Edward provided an explicit procedure for calculating cartridge holder series presented in smooth curves which researchers draw through plots of the data.Mitchell defined business cycles as sequence of magnification and contractions with a particular emphasis on the turning points and phases of the business cycles. Kydland and Edward consider the development in economic theory that Mitchells work and Lucas idea of business cycles.The term cycle is a broad term the most widely accepted example of cycle is the sunspot cycle that varies in length from under 10 to 20 years. Most evident feature of the cycle is the