Behavioral finance only challenged market efficiency seriously from the 1990s onward.

Evidence

Over and above questions of the analytical tractability of models lay a central theoretical commitment. Orthodox financial economics was, and is, committed strongly to a view of financial markets as efficient. That commitment has now been challenged forcibly by the rise of “behavioral finance,” which emphasizes investors’ propensity to systematic errors in reasoning. Behavioral finance is, however, a relatively recent development. The work by the psychologists Daniel Kahneman and Amos Tversky that inspired behavioral finance dated from the late 1970s, but not until the 1990s did behavioral finance become prominent. In the 1960s and the 1970s, the commitment to market efficiency faced no serious challenge within financial economics, for all that it aroused practitioners’ ire. — Donald MacKenzie, An Engine, Not a Camera, 1104

Categorization

• XREF: Ties directly to the performativity thesis — behavioral finance is the main rival paradigm to the efficient-market program.