Psychology in finance 2600-DSFRz2PF

Scope of issues discussed:
1. The specifics of scientific cognition in psychology and its applications
 How do we acquire scientific knowledge in social sciences (finance, management, psychology, economics)?
 Types of scientific reports. Which ones can we trust? The prevalence of experimental studies over correlational ones.
 Situational and psychological realism in empirical research.
 External validity (generalizing results obtained in research to a population) and internal validity (inferring a causal relationship).
 Methods of diagnosing employees (including diagnosis of personality, temperament).
 What is the importance of psychological knowledge in human resource management, organizational behavior, consumer behavior in the market.
APPLICATIONS - integration of financial and psychological issues within the framework of financial psychology: the so-called behavioral finance 2.0.
2. Human cognitive functioning
 How do our minds function?
 Cognitive categories.
 Networks of connections: Activation of connections - screen of consciousness and working memory.
 The effect of cognitive resource limitation and competition for free cognitive resources. The role of working memory content.
 Nonverbal record of experience (holistic system) vs record of cognitive activity (analytical system).
 Automatic and controlled processes.
 Activation of cognitive schemas/representations.
 Can our memory be reliable?
 Dynamics of memory records.
 The effect of retroactive certainty ("I knew it before").
 Effects of precedence, freshness, anchoring, confirmation, inertia, too early activation.
 Asymmetry of activation and deactivation processes.
 Anchor/confirmation effect: assimilation vs. contrast.
APPLICATIONS: perception of money-cognitive errors in financial evaluations, predictors of dishonesty.
3. Emotional functioning of humans
 Types of emotional reactions: stenic and asthenic emotions; feelings, sensations and moods; endo- and exocentric emotions;
 Descriptive opinions, evaluations: evaluative vs emotional.
 Can I believe what I feel? The effect of misinterpreting physiological arousal. Contagion of emotions. Affective attractors - positive-negative asymmetry.
 Dynamics of emotional reactions: perseveration; effects: exposure, novelty, habituation/adaptation/transference.
 Recognition, interpretation and regulation of emotional processes.
APPLICATIONS: psychological aspects of greed, professional burnout in financial institutions.
4. Human behavioral functioning
 Focus effect
 Dynamics of motivational processes, pursuit of evaluative conformity forcing reduction of cognitive dissonance.
 Reflective vs. unreflective behavior: habitual vs. impulsive.
 Decision-making (individually vs in a group) and action planning.
 Reef of perspective: differences in explaining others' behavior vs. one's own (focus on cause - why I do it vs. anticipated consequences - What is the purpose of my actions).
 Metamorphic effects of exercising power over others.
APPLICATIONS: attitudes toward earning, saving, spending money, psychological determinants of investor decisions: the Pygmalion effect in the stock market, psychosocial mechanisms of the speculative buble

NOTE: During the class, the order and scope of issues discussed may be changed due to the dynamics of the student learning proces.

Type of course

elective courses

Mode

Classroom

Course coordinators

Grażyna Wieczorkowska-Wierzbińska

Learning outcomes

Student/Student upon completion of the course:
In terms of knowledge:
 Knows and understands the terminology and basic theoretical models in the field of psychology in finance (K_W01)
 Knows and understands to an advanced degree the principles and practices of the psychological basis of human functioning in different types of organizations and financial markets (K_W02).
 Knows and understands psychological processes and phenomena and their impact on the functioning of organizations and financial markets (K_W05)
In terms of skills:
 Can correctly interpret psychological processes and phenomena in financial organizations and their impact on financial decisions using an appropriate selection of sources (K_U02)
 Is able to prepare analyses, diagnoses and reports independently and as a team, taking into account psychological aspects of the functioning of organizations and present them communicatively, using information and communication tools (K_U03)
 Is able to plan, organize own and team work (K_U05)
 Has the ability to self-educate and improve acquired skills (K_U06)
In terms of attitudes:
 Is ready to evaluate and critically approach situations and phenomena related to psychological aspects of financial management in organizations, accounting, management of financial institutions and strategies of financial institutions (K_K01)
 Is ready to adhere to professional ethical standards (K_K03)

Assessment criteria

The course ends with a credit. The credit applies to work throughout the semester.
The credit system follows the intellectual gym model (everyone lifts the weight appropriate to his time capabilities and aspiration level).

Measuring student knowledge gains consists of two phases:

LEARNING PHASE - which consists of online tests without limits on time and number of attempts - what counts is the best result (work without time pressure) and other short tasks on the online platform.

CERTIFICATION PHASE - two tests after the 3rd and 6th classes, in which questions are drawn from online tests in the LEARNING PHASE. Colloquia have a limited duration (work under time pressure).

If you do not pass the class by the normal deadline, you will face oral credit. Violation of the rules of academic honesty (e.g. downloading) will result in a failing grade in the course without the possibility of correction. You will have to repeat the subject next year.

Requirements:
1. for a sufficient grade:
(1) at least 60% in both colloquia; (2) active participation in classes checked by completing tasks - there is no need to participate in group work.

2. for a good grade:
(1) at least 70% in both colloquia; (2) positive evaluation of group work; (3) active attendance in classes checked by completing tasks

3. for a very good grade:
(1) at least 90% in both colloquia; (2) positive evaluation of group work; (3) active attendance in classes checked by completing tasks

Additional possible bonus points added to the average result of both colloquia:
 depend on the percentage of the grade obtained in the LEARNING PHASE and constitute a surplus of over 60%, e.g. a student who achieves a result of 90% on the platform in the LEARNING PHASE will have as much as 30% added to the average of both colloquia
 5 % for participation in the recommended scientific study.

Bibliography

Background reading (fragments available on the e-learning platform):
1. Wieczorkowska-Wierzbińska G., Psychologiczne ograniczenia.
2. Wieczorkowska-Wierzbińska G., Zarządzanie ludźmi - optyka psychologiczna.
3. Zaleśkiewicz T., Psychologia ekonomiczna.
Additional:
1. Ariely D., Szczera prawda o nieuczciwości.
2. Thaler, R.H., Sunstein, C.R., Impuls.

Additional information

Additional information (registration calendar, class conductors, localization and schedules of classes), might be available in the USOSweb system:

Description of 2600-DSFRz2PF in USOSweb