History of the Behavioural Finance Working Group

The Behavioural Finance Working Group (BFWG) was established in January 2008 by Professor Gulnur Muradoglu with the following objectives: 

  1. To understand better human behaviour in finance.
  2. To develop the field of behavioural finance by facilitating interdisciplinary work that integrates finance, psychology, sociology and economics 
  3. To promote interaction between academia and the financial services industry.
  4. To contribute to a better functioning global financial system.

With the 2008 financial crisis it became clear more than ever that we need research that will help establish a better functioning global financial system. Practitioners worldwide needed better models based on actual human behaviour to improve performance and stability. Regulators worldwide needed to use human behaviour itself rather than unrealistic assumptions to regulate markets. Corporate managers, institutional and individual investors needed a better understanding of how the financial system actually works rather than relying on (false) assumptions. Academics could help both sets of parties by providing a better understanding of human behaviour in finance and BFWG was established to work in that direction. 

The BFWG conferences targeted exploring human behaviour in finance in different financial domains from the very start and kept that promise until today. In terms of people who make financial decisions, we range from the very poor to regulators and international investors. In terms of psychology of financial decision–making, we cover emotions, trust and empathy. In terms of methodology, we cover experiments, interviews, surveys and participant observations. 

The Behavioural Finance Working Group Team
First BFWG Conference

The first meeting of the BFWG was held at Bayes (formerly Cass) Business School led by Professor Gulnur Muradoglu. There were only ten participants in the first meeting including colleagues from finance, psychology, sociology, practitioners and PhD students. The second meeting was held in 2009 and membership increased to about 100 members. The topic was of course the 2008 crisis and its aftermath. From 2009 onwards the conferences continued and membership increased. Visit our Previous Conferences page for a list of past conferences.

Professor Gulnur Muradoglu was the director of the BFWG from 2008 to 2022. In 2022 Professor Arman Eshraghi joined as co-director. By that time membership had increased to more than 700 and the group was truly international and multidisciplinary. Together they are moving the BFWG forward. The beneficiaries of the BFWG activities are as follows: 

1. Academic communities

Scholars benefit from the interdisciplinary approach and the interdisciplinary work that integrates finance, psychology, sociology and economics. There is a lot to be done to understand the complexity of decision-making processes in finance. Different academic fields work on them using different methodologies. Although econometric methodologies are now standard in finance, experiments, surveys, interviews, participant observation and focus groups are also used. Interdisciplinary research and dialogue is becoming more frequent. The true merit of interdisciplinary work does not simply lie in a simple transaction of one field borrowing an idea or a concept, but when disciplines or research methods are integrated into a new field of study. 

2. Practitioner communities

Practitioners from different fields of finance make corporate decisions as well as decisions about investments, loans, mortgages, insurance policies, and regulation. Practitioner communities benefit from the interdisciplinary work produced in the seminar series and the interdisciplinary networks established. BFWG help share ideas and information and develop the links to work together. Practitioners will benefit from the activities of the seminar group by improving their performance, designing better products for clients and more viable long-term strategies. They will have a better understanding of their own behaviour, that of clients and competitors, and the system effects. This will help with a better functioning global financial system.

3. General Public 

The general public benefit from the work of the seminar group indirectly. Ordinary people are affected by the financial decisions made by bank managers, fund managers, and regulators. Households are affected by the financial crisis. Since 2008 we experienced another global crisis with the covid pandemic. The general public make financial decisions for themselves. They save, they open bank accounts, they invest, they borrow, they take mortgages, they use credit cards. Work produced by the seminar group will help them understand their behaviour own financial better. Financial institutions such as banks and insurance companies will use this work to provide better service to their clients. Regulators will use this work for better regulatory frameworks.