Socionomics

AAA

DEFINITION of 'Socionomics'

The study of the relationship between social mood and social behavior pioneered by Robert R. Prechter, Jr. Socionomic theory proposes that social mood influences the aggregate character of social actions, such as those found in the economy, financial markets and politics.

INVESTOPEDIA EXPLAINS 'Socionomics'

Socionomics can be applied to many areas of social activity. The socionomic perspective frequently differs from that offered by conventional observers of society. Prechter has noted the following, for example:

Conventional observers often imply that rising markets make investors optimistic. Socionomic theory proposes that optimistic investors make markets rise.

Conventional observers often imply that recessions result in more cautious business practices. Socionomic theory proposes that more cautious business practices result in recessions.

Conventional observers often imply that scandals outrage the public. Socionomic theory proposes that an outraged public seeks scandals.

RELATED TERMS
  1. Engel's Law

    An economic theory introduced in 1857 by Ernst Engel, a German ...
  2. Bandwagon Effect

    A psychological phenomenon whereby people do something primarily ...
  3. Guanxi

    A Chinese term meaning "networks" or "connections," understood ...
  4. Market Psychology

    The overall sentiment or feeling that the market is experiencing ...
  5. Caveat Emptor

    A Latin phrase for "let the buyer beware." The term is primarily ...
  6. Inflationary Psychology

    A state of mind that leads consumers to spend more quickly in ...
Related Articles
  1. How Influential Economists Changed Our ...
    Fundamental Analysis

    How Influential Economists Changed Our ...

  2. Investors Intelligence Sentiment Index
    Technical Indicators

    Investors Intelligence Sentiment Index

  3. The Biggest Stock Scams Of All Time
    Investing

    The Biggest Stock Scams Of All Time

  4. Is A Reversal On The Way? Consult Traders' ...
    Active Trading

    Is A Reversal On The Way? Consult Traders' ...

comments powered by Disqus
Hot Definitions
  1. Last In, First Out - LIFO

    An asset-management and valuation method that assumes that assets produced or acquired last are the ones that are used, sold ...
  2. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  3. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  4. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  5. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  6. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
Trading Center