Behavioral finance: the relationship between the level of financial education and cognitive biases

Abstract

In a capitalist scenario, one of the most intriguing elements that draw attention in the Brazilian scenario is the contradictory resistance to openly discussing money. This article investigates the relationship between the level of financial education and the behavioral biases of certainty and framing effect in Business Administration and Accounting students at a higher education institution located in Caucaia (CE). The biases under analysis belong to prospect theory, which strives to consider a crucial factor that is often neglected in decision-making analysis: human emotions. For the research, a descriptive field approach was used through an online questionnaire. Such results were compared to research by Kahneman et al. (1979); and revealed the presence of certainty and framing effects in students, showing that a low level of financial education makes them more susceptible to these biases. It is hoped that this study will contribute to the understanding of the relationship between: financial education, behavioral bias and decision-making (financial and non-financial) of Business Administration and Accounting students, providing new and valuable insights for the field. In the global context, the importance of this research lies in promoting a paradigm shift in relation to financial education and behavioral biases, as it impacts not only financial decisions.