Neurofinance

Abstract

Today due to technological advancement the global economy is threatened from three major challenges: namely climatic changes, energy crisis and financial constraints. As a result of human pressure on Earth’s resources, natural capital has declined. Increase in environmental Pollution, natural resource depletion and effects from global environmental issues compel large economic stresses and costs. In order to meet these challenges, new ecologically sustainable development strategies, that lead to economic growth and increased social equity while preserving the environment and responding to the rapidly increasing problems related to climate change, must be adopted. Hence, There is great need to support such Green Growth strategies that induce the required revolution process towards low-carbon and resource-efficient economies. A green financial system is the remedy for achieving harmony between the economy and the environment. One such sector is Green Banking. Green Banking means adopting environment friendly practices in banking sector and thereby reducing internal and external carbon footprints. It promotes green investments in renewable energy development projects which help in achieving sustainable economic growth for the nations. The present study primarily aims at exploring existing literature on the Green banking initiatives taken by the top leading private sector banks in India. Secondly, to know about the different green processes available in the Indian financial markets, and thirdly the future scope of green finance in India.

Financial decision-making is a crucial part of business survival, especially among SMEs. About 95% of the
business are facing failures within five-year time. The financial decision making failure happened due to psychology and
behavioural. This research aims to determine the mediating effect of representativeness heuristic on emotions and
financial decision making. A pre-test and post-test experiment analyzes emotions, financial decision-making, and
representativeness heuristic behaviour. In pre-testing, emotions and financial decision-making questionnaires are
measured using questionnaires distributed to forty-two SMEs. Then, the video clips with 12 to 16 minutes duration are
used in manipulating the emotions from neutral emotion to positive and negative emotions. Lastly, in post-testing, the
data are gathered by repeating answered emotion and financial decision-making questionnaires, followed by the
representativeness heuristic questionnaire. The data were analysed using General Linear Regression. The results
showed that representativeness heuristic is partially effect on negative emotion towards financial decision making. From
the analysis, neuro-behavioural of financial decision-making model has been proposed. The proposed models are
incorporating with the brain components and working memory. It shows that System 1 and System 2 of the dual-process
theory are activated for negative and positive emotions

This study explores the interaction between finance and neurosciences, which is one of the emerging research areas since beginning of the new millenium. After highlighting the epistemological  presuppositions of this school, the study reviews it most important characteristics compared with neoclassical and behavioral schools. In reference to a methodology distinguishing between the mind related to representation and cognition and hat related to conduct and guidance, the study goes beyond the problem of the container of mind traditionally seen as a zero-sum game:
Is it in the brain or in the heart? This epistemological posture could allow Islamic finance to exploit neurosciences by combining  functional magnetic resonance imaging (fMRI) with heart rate variability (HRV), and contributes to highlight the importance of Islamic principles in the financial markets.
Keywords: Methodology, Islamic view, finance, neurosciences, rationality, emotion, brain, heart, neoclassical and behavioral schools, combined HRV-fMRI analysis

Nowadays, people use financial wellness’s as terminology to understand the level of the individual’s financial condition. Previous researches show that although the persons have a lot of debts, they feel satisfied with their financial status. Conversely with those who are in good financial wellness with their wealth of life. Additionally, two elements have been discussed in relation to the income earner’s financial wellness which is economic well-being and financial well-being. Imbalance of financial wellness among low-medium income earners is due to reducing in employment opportunities, income instability and increase the number of family members. Therefore, personal financial management is important to ensure good or bad financial wellness among income earners. In this paper, financial literacy and financial stress are considered to determine the relationship of financial wellness. The result showed that both factors are significant with a strong positive relationship. It is impor...

Abstract: The Asian Development Bank is a regional development bank which came into existence on 19 December 1966,[1] it is headquartered in the Ortigas Center located in Mandaluyong, Metro Manila, Philippines. The organization also maintains 31 national field offices around the world [2] to promote social and economical development in Asia. The bank admits the members of the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP, formerly the Economic Commission for Asia and the Far East or ECAFE) and non-regional developed countries.[3] When ADB was formulated it had only 31 members now it has 67 members, among which 48 are from within Asia and the Pacific and 19 from outside the Asian region. The ADB is closely modeled on the World Bank, and has a similar weighted voting system where votes are distributed in proportion with members' capital contribution. ADB raise its funds through bond issues on the world’s capital markets, member contributions, retained earnings from lending operations and the repayment of loans.ADB releases an annual report that summarizes its operations, budget and other materials for review by the public.[4] Major borrowers of ADB include India, Indonesia, Pakistan and People’s Republic of China followed by four more countries, which includes Bangladesh, Philippines, Sri Lanka and Vietnam. At the end of 2015, Japan holds the largest proportion of shares at 15.62%. The United States holds 15.51%, China holds 6.45%, India holds 6.33%, and Australia holds 5.79%.[5]The present paper basically aims to explore the working of Asian Development bank and study the projects sanctioned by it for development of India in the year 2016.

Spesso, investitori ed economisti si rivolgono alla teoria dei giochi per aiutarsi a prendere scelte ottimali, ma questa può spesso indurre ad errori. Infatti, la teoria dei giochi fa previsioni assumendo capacità cognitive illimitate, che sono implausibili dal punto di vista cognitivo, e che potrebbero specialmente essere fuorvianti laddove le nostre scelte dipendono da altri, che potrebbero non comportarsi in mo-do poi così strategico. Durante gli ultimi vent'anni, le neuroscienze e le scienze cognitive hanno dipinto un'immagine più psico-biologicamente plausibile di come ragionano e interagiscono gli esseri umani. Nella prima parte di questo capitolo, de-scriveremo come una rete cerebrale particolare, incentrata sulla corteccia mediale prefrontale, sembri giocare un ruolo particolare nella cognizione sociale (e non necessariamente nella cognizione in generale) e nella sofisticatezza del ragionamento strategico in un concorso finanziario ispirato da Keynes. Quest'area cerebrale potrebbe essere specializzata nel compiere inferenze sugli altri, mentre questi compiono inferenze su di noi. Nella seconda parte, illustreremo diversi modi in cui, la mente-cervello potrebbe aver tentato di semplificare i problemi decisionali, portandoci a restringere l'attenzione su alcune informazioni, a scapito di altre. Infatti, mostreremo come molte delle nostre decisioni potrebbero già essere racchiuse nel modo in cui analizziamo visivamente le informazioni a disposizione. Plausibilmente, una futura teoria delle decisioni riuscirà ad integrare la teoria dei giochi, con una teoria della mente. " Gli investimenti finanziari dei professionisti assomigliano a quelle competizioni che si trovano nei giornali, nelle quali i concorrenti devono scegliere i volti più belli tra un centinaio di fotografie e il premio viene assegnato al concorrente la

Özet Klasik iktisatçıların rasyonel beklentiler teorisine göre insanlar rasyonel olarak faydaları maksimize etmek istemektedirler. Buna karşın son yıllardaki çalışmalara göre insanlar kararlarında irrasyonel davranmaktadır. Bu nedenle günümüzde tüketicilerin/yatırımcıların irrasyonel kararlarına etki eden faktörleri araştıran çok sayıda çalışma bulunmaktadır. Bununla birlikte tüketicilerin/yatırımcıların kararlarında gizli güdülerin veya bilinçaltı süreçlerin daha çok etkili olduğunu ortaya koyan çalışmalar yenilikçi çalışmalara öncülük etmiştir. En sık kullanılan yenilikçi veri toplama yöntemleri ise elektroansefalografi (EEG), göz izleme (eye tracker), yüz kaslarından duygu tanıma, ses frekansından duygu tanıma, kalp atım hızı ölçme (HR) ve galvanik deri tepki (EDA, GSR) cihaz ve yazılımlarıdır. Son yıllarda beyin ve beden tepkilerinden elde edilen veriler ile yapılan bu çalışmalar nöropazarlama ve nörofinans olarak adlandırılmaktadır. Bu çalışmada bu yenilikçi cihaz ve yazılımlar ile yatırımcıların/tüketicilerin kararlarında etkili olan gizli güdüleri ve bilinçaltı süreçleri nasıl ölçebileceğine dair örnek uygulamalar yapılarak teorisyenlere ve pratisyenlere önerilerde bulunulacaktır. Abstract According to the classical economists' theory of rational expectations, people rationally want to maximize their benefits. However, according to recent studies, people act irrationally in their decisions. For this reason, there are many studies investigating the factors that affect the irrational decisions of consumers / investors. However, new studies reveal that hidden motives or subconscious processes are more effective in the decisions of consumers / investors have pioneered innovative studies. The most frequently used innovative data collection methods are electroencephalography (EEG), eye tracking (eye tracker), facial expression recognition, heart rate (HR) and galvanic skin response (EDA, GSR) devices and software. These studies, which have been conducted with the data obtained from brain and body responses in recent years, are called neuromarketing and neurofinance. In this study, suggestions will be made to theorists and practitioners by making sample applications on how to measure the hidden motives and subconscious processes that are effective in investors' decisions with these innovative devices and software.