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Institutional investor behavioral biases: syntheses of theory and evidence

Zamri Ahmad (School of Management, Universiti Sains Malaysia, Penang, Malaysia)
Haslindar Ibrahim (School of Management, Universiti Sains Malaysia, Penang, Malaysia)
Jasman Tuyon (Faculty of Business Management, Universiti Teknologi MARA, Kota Kinabalu, Malaysia)

Management Research Review

ISSN: 2040-8269

Article publication date: 15 May 2017




This paper aims to review the theory and empirical evidence of institutional investor behavioral biases in the lenses of behavioral finance paradigm. It surveys the research specifically focusing on behavioral biases among institutional investors in investment management activities worldwide.


A literature survey is done to gather and synthesize evidence on behavioral biases of institutional investors.


The survey and analysis reveal the following findings. First, the theoretical underpinning of investors’ irrational behavior has been neglected in behavioral finance research. Second, the behavioral heuristics and biases are dynamic and complex. Third, understanding behavioral biases’ origin, causes and effects requires interdisciplinary perspectives from the fields of psychology, sociology and biology.


The analysis and alternative perspectives drawn in this paper provide new insights into the field of behavioral finance and aims to suggest researchers, practitioners and regulators on the next course of actions.



The authors greatly acknowledge the financial assistance provided for this research by Universiti Sains Malaysia (USM) through USM-RUI Grant No. 1001/PMGT/816276.


Ahmad, Z., Ibrahim, H. and Tuyon, J. (2017), "Institutional investor behavioral biases: syntheses of theory and evidence", Management Research Review, Vol. 40 No. 5, pp. 578-603.



Emerald Publishing LimitedBingley, United Kingdom

Copyright © 2017, Emerald Publishing Limited

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