Investors, businesspeople, students and academics need to know much more about psychology. In the video below, the folks at Moneyweek discuss how psychology affects investors. If you want to read about how psychology affects decision-making, you should start with Daniel Kahneman's Thinking, Fast and Slow.
My colleague and former PhD student Gareth Campbell has created a website about the British Railway Mania - click here . This episode has been described by the Economist as probably the greatest bubble in human history. Gareth's website provides background on the Mania and posits some explanations for the 'bubble'. In his explanation of why the bubble happened, Gareth places a lot of emphasis on investor myopia regarding future dividends and uncalled capital. His study of investors during the episode does not support the view that this episode was fuelled by naive and irrational investors.