Market Behavior and Performance

Market behavior refers to how individuals and groups make economic decisions, often influenced by psychological factors rather than purely rational thinking. Experimental and behavioral economics study these patterns to understand why people might act against their own interests, such as overvaluing immediate rewards or being swayed by emotions. Performance, in this context, refers to how effectively markets allocate resources and respond to these human behaviors. By observing real-life scenarios and conducting controlled experiments, economists gain insights into improving market efficiency and fostering better decision-making in economic activities.