Mirror neurons contribute to herd behavior in markets from "summary" of Your Money and Your Brain by Jason Zweig
Mirror neurons are a remarkable discovery in neuroscience. These neurons fire not only when we perform an action ourselves but also when we see someone else doing the same action. This creates a sense of empathy and allows us to understand and connect with others on a deeper level. In the context of the financial markets, mirror neurons play a crucial role in shaping our behavior. When we observe others buying or selling a particular stock, our mirror neurons fire, causing us to feel the same emotions and impulses. This can lead to a herd mentality, where individuals follow the crowd without critically evaluating the situation. The herd beh...
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