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Herding by fdjerue7eeu


Basic definition
[Herd Effect]

Placed horizontally in front of a stick in a flock of sheep, the first
sheep jumped in the past, second only, and a third will follow the jump
in the past; this time, stick to Flanagan to withdraw behind the sheep,
came here, still Like sheep, like the previous upward jump about,
although blocking stick has gone, this is the so-called "herd
behavior" also known as "herd mentality." Refers to the
management of some enterprises in market behavior of a common phenomenon.
It is due to insufficient information and lack of understanding would be
difficult to uncertainty about the future of the market to make
reasonable the Yu Qi, often through observation of the behavior around
the Renqun Tiqu information, the information in Zhezhong the
Buduanchuandi in Many people will be roughly the same information and
strengthen each other, resulting in herding. "Herd behavior" is
the result of rational behavior by individuals collectively irrational
behavior of a nonlinear mechanism.

Herding the field of behavioral finance is typically a phenomenon of the
mainstream financial theory can not explain. Often used in economics,
"herding" to describe the psychological economic individual
herd to follow suit. Flock is a very scattered organization, usually with
the left and right is blind to the collision, but once there is a sheep
moving up, the other sheep will herd phenomenon without hesitation,
without regard there may be a wolf in front of or near Department has a
better grass. Therefore, the "herd behavior" is the metaphor of
people have a herd mentality, herd mentality can easily lead to blind
obedience and blind obedience often find fraud or failure.

The emergence of herding the general in a very competitive industry, but
also the industry has a leader (leader) occupied the major attention,
then copied by the entire flock will be the leader's every move, the lead
Where sheep "graze", where the other sheep, "Gold
Related Stories
There is humor reflects the herding:

An oil tycoon to heaven to attend the meeting, a discovery has been
packed into the conference room, no place taking a seat, so he had an
idea called: "the discovery of oil the hell!" This call does
not matter if the oil tycoons in heaven Hell have to go, and soon, in
heaven who later left with a. Then, the tycoon thought, we all ran in the
past, is it really the discovery of oil the hell? Then, he hastily ran to

Herding is the metaphor people have a herd mentality, herd mentality can
easily lead to blind obedience and blind obedience often find fraud or

French scientist Jean Henri Fabre have done a pine experiment. He put
some pine on the edge of a pot to make it end to end phase in a circle,
not far from the pot, then sprinkle some pine caterpillars like to eat
pine needles, pine around the beginning of a with a another enclosure pot
lap to go. The walk is seven days and nights, hunger, tired of dead pine
caterpillars count them out. But sadly, as long as any one can eat mouth
slightly changing the route of pine needles.

Animals, so people are not necessarily smarter. Social psychologists
study found that affect the herd of the most important factor is the
number holding a certain number of views, not the opinion itself. Were
more persuasive in itself, very few people will insist on unanimous
cases, their different opinions. "The masses have sharp eyes,"
"wood show in the forest, the wind will destroy the"
"first rotten rafters in his early" These doctrines closely
tied to our actions. The late 20th century, the Internet economy soared,
". Com" companies blossom everywhere, all the investors are
staking their claims to sell the concept, IT industry CEO who burn in the
game, burning the amount of stock will rise much, so, the more and more
and more people are turning back to forging ahead.

2001, and once the bubble burst, vanity make casual, we discovered that
in the frenzied market atmosphere, profit is the leader, the rest follow
suit of the have become victims. The media often serve as instigators of
herding, a rumor through the newspaper will become a recognized fact that
a point can become public through television. Demonstrations, election
rally, suppression of dissent and other political art is not in the use
of non-herding.

Of course, there's something there are always reasonable, herding is not
necessarily good for nothing. This is the nature of the optimization
rules, information asymmetry and the expected uncertainty in the
conditions, see how others do indeed lower the risk (which in game
theory, Nash equilibrium has also instructions). Herding demonstration
study can produce synergy effects and aggregation, which for the
protection of vulnerable groups and development is helpful.

Herding tell us: the information to others, not all letters are not from
time to believe, all things have their own judgments, surprisingly to
winning, but the follower has the advantage, often way is not fixed!
Life herding
A man running in the streets during the day, everyone ran with the
results, in addition to the first person, we do not know the reasons for
running. People have a herd mentality, the resulting phenomenon of blind
obedience is the "herding."

Many times we had to give up their individuality to "follow the
crowd" because each of us can not possibly know everything was
crystal clear, for those who do not know, not sure what is often "go
with the flow." Holding a view of the number of affected herd is the
most important factor, very few people able to unanimous cases, adhere to
their own opinions. Pressure is another deciding factor. Within a group,
who made the unusual behavior, often lead to "betrayal" of the
suspects, will be isolated, or even punished, and thus the behavior of
members within groups is often a high degree of consistency.
"Herding" tells us that many times, not saying that as -
"the masses have sharp eyes." In the market the general public,
they often lose their basic sense of. People like to join in the fun,
along with other people. The eyes of the masses of information media is
also to invest, and want to be the basis to judge. However, the media
were also ordinary people, not your eyes, you will not lose the direction
to identify spam. Therefore, the collection of information and keen to be
judged, is to allow people to reduce their herd behavior, more rational
use of their own best way.

And guide the rational use of herd behavior, you can create a regional
brand and scale effect, and thus get better results more good than harm.
Find a good leader is to use the key to herding.

For individuals, with the rear end in the footsteps of others will
inevitably be eaten or eliminated. The most important thing is to have
their own ideas, do not take the unusual way is a shortcut to your stand.
Whether to join an organization or own businesses, to maintain innovation
and independent thinking are essential.
Stock Market herding
In the capital markets, "herding effect" refers to an
investment group, individual investors are always under the action of
other similar actions of investors in buying when others buy, sell when
others sell at. Lead to "herding" There are other factors, for
example, some investors may think that the same groups, others in more
information superiority. "Herding" mechanism may also be
triggered by the system. For example, when a sudden fall in asset prices
caused losses, in order to meet margin requirements or to comply with
restrictions on trading rules, some investors have had to cut positions
in its holdings of assets sold. In the current enthusiasm for substantial
increase in the stock market situation, the rapid accumulation of
individual investors, energy, easy to form a convergence of herd
behavior, chasing rush with confidence when brought out diving when the
broader market, panic began a chain reaction, have panic escape, so when
diving Liangnengfangtai also normal. Only then easily kill the stock
price on the floor. This is why the bull market in fast or slow up, and
sell into corrections often the root causes of a place. But we need to
remember that, in general, not out when the rapid sell into corrections.
Rational herd behavior and the stock market the unity of opposites
Stock market investor herd behavior is the presence in the trading
process of learning and imitation behavior, resulting in a certain period
of time in the same shares traded. Keynes pointed out long ago: "to
engage in stock investment is like a beauty pageant contest, who selected
the choice of the average results of all the nearest-loving, who can
award; so each participant will not vote for him who they think best, but
the use of intelligence, suggesting that most people think the most
beautiful person. "visible, herd behavior is out of a sense of
belonging, a sense of security, and information cost considerations,
small investors will take the public and follow the leader follow the
principle of direct imitation of the public and leaders trading
decisions. The individual concerned, this behavior is rational or
irrational, economists do not lead to uniform conclusions. Extreme
rationalist such as the University of Chicago professor Gary ? S ? Baker
said: "All human beings are rational economic behavior, economists
can not explain the reason why is because they can not help but non-
rational behavior, careless , stupid behavior, and changes in the value
of particular assumptions shows that they can not explain the phenomenon
in order to cover up their lack of knowledge, and these assumptions has
just exposed the failure of their hide. "Becker's point of view,
albeit extreme, but it allows us to I believe as long as we do not
diagnose the analysis, individual market participants of the "herd
behavior" is how several rational. Such as social psychology control
experiment confirmed that: When we look at reality blurred, the public
has become sources of information, or provide a public act of information
on how to act. In the stock market, due to information asymmetry, the
individual can not share information from a limited to make a reasonable
decision, that is the rational herd behavior, although with such a
rational means of last resort. So I think the stock market's herd
behavior often is the beginning of individual rationality, through its
amplification and transmission of effect, those who follow the trend of
gradually showed a tendency of non-rational, and thus achieve the overall
irrationality. When the stock market speculation over when, on the
emergence of the "irrational exuberance." This is like a
fertile grassland, only a few sheep, and should be said that they will
eat very full. But the day attracted a large flock, and this time would
be to feed into the desert grasslands of the. At the same time getting
enough to eat a sheep, some fell, some movement, but if the only smart
sheep, then it should not be followed by a large force, it should be
here, so that grass is growing, and so on will become a fat sheep. So,
sometimes what we all think that something when the fact may be just the
opposite in fact.
To overcome the herding stocks
If you are desperate to sell shares, you must sell low. - Investment guru
Peter Lynch when the market is in a recession, the fact is the investment
layout, high harvest waiting for the next best opportunity, however,
because most investors there is "herding" mentality, when we no
interest, even with the best growth prospects of the investment products
are no buyers; and wait until the market fever grows, the investment
professionals scrambling to snap up approach, once the market a little
adjustment, you will rush to blaze, it seems Most investors can not
overcome the investment psychology. How to avoid follow the trend of
operating it, our recommendation is: investors combined with their own
investment objectives, risk tolerance and other factors, to set profit
point and stop point, while controlling their own emotions to face the
ups and downs, enhance personal "ring urgently forbearance
"capability, so as to successfully achieve investment objectives.
Fund investments, like stocks, although not as short-term access, but the
appropriate conversion or adjustment of the portfolio is also necessary,
because some venture funds can not be avoided, such as the cyclical
market risk, even with the star fund must bear market economy and
industry Periodic fluctuations of risk. Profit point can be set to remind
you investment objective has been achieved, to avoid falling into the
weakness of human greed, but missed the final redemption of time, so that
profits shrink. Set stop-loss point, you can lock your investment risk,
in order to avoid greater losses that may arise. When the fund returns to
profit and loss conditions, you should determine whether the profits or
the redemption of indemnity. Setting a profit point and reference for a
lot of stop-loss point, in general, investors can combine their own risk
tolerance, profit expectations, the current age in which family economic
conditions and market characteristics where taken into account at the
same time on a regular basis check the return on investment, so as to
identify the most profitable investment portfolio for their own and stop
interval. Here special emphasis on regular inspections of each quarter,
the fund investment is suitable for lazy people, but still need to check
the fund performance every quarter, ranking changes, changes in
investment target for the final redemption or conversion to provide basis
for decision making, so as not to miss the best selling point or too back
out. Be noted that, when the fund returns a profit for their own set
point or stop point, not necessarily immediately recognize profits or
lost sale, and you should assess the long-term trend is still bullish on
the market, whether the direction of fund operations correct, and even
its own profit point or stop if the market conditions at that time, and
then decide how to adjust the portfolio. If it is because short-term
market adjustment and hit stop, then should not rashly redemption, so
that the market rebound soon, you have to sell because of lack of
patience in low. If the fund performance in the same type of funds
outstanding, while the home market is also bullish on long-term, short-
term fluctuations to stop just because the point, this time, if Neng
tolerate the continued holding of the risk, perhaps you should re-set the
warning conditions, or even take the opportunity to overweight, to dip
the purpose of sharing level. Conversely, when the market is a foregone
conclusion from the long to short, or the market price-earnings ratio is
too high, market risk increases, regardless of whether the profit point,
should be redeemed as soon as possible to find the best time.
Workplace in the herding
In the highly competitive "boom" of the industry, it is prone
to "herding" to see a company doing business to make money, and
all firms flock to commence this business, until a significant increase
in industry supply, production capacity supply and demand imbalance. We
are keen to imitate the leader's every move, sometimes the lack of long-
term strategic vision.

For those of us in terms of workplace where people are often also
possible "herding." IT do to make money, we all want to do IT;
do management consulting to make money, we all rush to own up; in foreign
work, as a mouth English words often pop out the small white-collar,
looks very beautiful, so we have to learn English; now become a civil
servant is very stable and good income, college graduates have to take a
civil service ... ...

We are not sheep, we must use their brains to think, to measure

We should look for the real work of their own, rather than the so-called
"hot" work, said that "fear of the wrong men and women are
afraid to marry the wrong husband" and "hot" job does not
belong to us, if the sub-personality and work efforts to the contrary
would lead to faster failure. We also pay attention to their chosen
industries and companies of the existence of potential crisis, no
industry and enterprises can not be the "safe harbor", the risk
always exists, must be bold and wise insight. With this sense of crisis
in a little later, naturally we must ready response, when the crisis
really comes how to do? In "Who Moved My Cheese", the gradual
fall in the end the small mouse can not eat cheese, but there is a sense
of crisis around to look for new cheese in the little mouse, but before
the old eat cheese, they find a new life .
Herding the stock market and the Game Analysis
Herding is a stock market vision, its stock market stability, efficiency
greatly. Study abroad, information asymmetry, reputation and rewards
between managers of competition is the main reason for herd behavior,
articles on individual investors and institutional investors were among
the herd behavior theory, game analysis, from Another point of revealing
the causes and impact of this vision.

Financial market of the "herd behavior" (Herd behavior) is a
special kind of irrational behavior, it is the investors in the
information environment of uncertainty, the impact of actions by other
investors, making imitation of others, or over- dependent on public
opinion, regardless of their behavior because of information involves a
number of herd behavior is the main body of investment-related behavior,
the market's stability Xiaoshuai You Hentai the impact, and financial
crises are also closely related. Therefore, herd behavior caused
academia, the investment community and financial regulators attention.
Banerjee (1992) that the herd behavior is a kind of "people to do
things other people are doing the behavior, even if they own private
information that should not be taken to the act," that individual
regardless of private information, to take the same action with others.
Shiller (1995) the definition of herd behavior is a kind of social
interaction between groups of people tend to think and act in a similar
way. For example, in a group decision-making, similar to the majority
opinion, the individual tends to support the decision-making (even if the
decision is incorrect), while ignoring the views of opponents.

We believe that our stock market Individual Investors has the following

A. Individual   investors in China stock market shows very significant herd
behavior, and   herd behavior is stronger than the buyer the seller herd
behavior, the   time factor herd behavior of investors is not significantly
affected herd   behavior of investors due to its inherent psychological

B. Different market situation, investors have shown a significant herd
behavior, that is, whether investors are risk appetite or risk aversion,
have shown significant herding.

C. Impact of stock returns is an important factor in investor herd
behavior. Trading day, rose, investors showed more herding behavior.
Investors buyer herd behavior in the trading day when the stock price
declines than increases, herd behavior is contrary to the seller. The
whole is greater than the buyer the seller Herding Herding.

D. Stock size of herd behavior of investors is another important factor.
With the flow of capital stock size decreases, the investor herd behavior
gradually increased, which is the foreign research with the same
1 Cause of herding

Herd behavior on the formation of several explanations. Philosophers
considered the limited nature of human reason, psychologists believe that
is the human herd psychology, sociologists believe that the collective
human unconscious, and economists from incomplete information, agent to
explain herding behavior of the angle, In general, there are several

1.1 As the information generated by the similarity class of herding

Froot, Scharfstein and Stein (1992) pointed out that institutional
investors have a high degree of homogeneity, they are usually concerned
about the same market information, using a similar economic model,
information processing, portfolio and hedging strategies. In this case,
institutional investors could profit warnings or recommendations of
securities analysts and other external information to make the same
similar reaction in the trading activity is shown as herd behavior.

1.2 As the information is not completely generated by herding

Information can reduce uncertainty, investors have access to accurate,
timely and effective information means it is highly profitable, or to
avoid major economic losses. But in the real market, the information was
required to pay the economic costs of different investors access to
information and the ability to vary, institutional investors have the
resources, technology, and talent of scale advantages, Geti investors to
pay the cost of the information on the far far, compared with
institutional investors. A direct consequence of the resulting
institutional investors than individual investors more useful
information, the individual investors access to effective information and
access to investment income at a disadvantage when. Benefits or reduce
risks to individual investors, get more real economic signals, will be
asking around making the "inside information", or relish in the
"unwarranted" groundless, contributed to greater market
recovery wind tendency.

In fact, even institutional investors, the information is not sufficient.
In the incomplete information and uncertain market environment, assuming
that each investor have a stock of private information that may be the
result of investors own research or through private channels available;
the other hand, even if public information about the stock has been fully
disclosed, investors still can not determine the quality of information.
In this market environment, investors have no direct access other
people's private information, but can observe the trading behavior of
other people to guess when their private information, it is easy to
produce herd behavior. Although institutional investors, individual
investors in information relative to the strong, but because of
institutional investors to learn more about each other peer-trading case,
and concluded with a high information capacity, Instead, they more likely
than individual investors flock behavior.

1.3 The agent-based production of herding
1.3.1 Herding on the reputation of agent

Scharfstein (1992) and other fund managers and analysts to provide a
reputation-based herding theory. As the investment manager's ability is
uncertain, on the reputation of the concern arises.

Agent 1 received "high income" of the signal for investment. As
the agent of two concerned about his reputation, regardless of how the
signal will take, and as agents of an investment strategy. If the
decision is correct, his fame would be increased; If the error indicates
that either both are stupid, or two people are smart, but get the same
error signal, it does not harm its reputation. If you take a different
decision, a client will see at least one person is stupid. Therefore, the
use of an agent 2 will always flock strategy, regardless of his signal
and the difference between agents 1.

If you have several investment managers make investment decisions, the
first copy of each person to choose the investment manager decisions.
Ultimately, if the investment is profitable, good signal to dominant.
Private information will not be reflected in the final investment
decision, because all the investment managers will follow the first
investment managers to make decisions. So, this herding is invalid.
Moreover, it is fragile, because investment managers behind the
investment behavior of investment managers will be because the first bit
of information received change.

1.3.2 Agent-based compensation of herding

If the investment manager's compensation depends on their relative
investment performance of other investment managers, which would distort
investment incentives manager and lead manager of the selected investment
portfolio is invalid (Brennan, 1993).

Maug (1996) investigated such as risk aversion of investors, the returns
relative performance as investors increased, the relative performance as
investors reduced. Agents and his benchmark investment managers on stock
returns has incomplete information. Investors to invest in the first
benchmark, the agent observed the choice of investors after the benchmark
portfolio choice. Based on previous information is not sufficient herd
behavior model of portfolio selection of investment managers will tend to
select and benchmark portfolio of similar investors. Moreover, the reward
system will also encourage investment managers who mimic the choice of
benchmark, because, if his investment performance below the market
average investment performance, his pay will be affected.

Herding in Game 2

Herding production from individual investors and institutional investors
on their personal interests, therefore, to use game theory, we can gain a
deeper understanding of the causes of herding.

2.1 between institutional investors and individual investors Game
Institutional investors and individual investors the game can actually be
seen as a variant of Pigs Game, we assume that institutional investors
and individual investors to invest in the stock market, large
institutional investors as capital if the investment based on correct
information , can be 100 to the benefit of individual investors based on
correct information investment interest can only be 5, the two sides can
choose to collect and analyze information, the resulting cost of 20, you
can simply collect only the other's actions information to follow, so the
cost of production of 1, both sides give up the collection of
information, resulting in utility is zero. If institutional investors and
individual investors have taken to collect information and analyze the
behavior, then institutional investors will receive interest (100-20 =
80), individual investors can get (5-20 =- 15), if the agency investors
to gather information, individual investors to follow, resulting in the
interest of institutional investors (100-20 = 80), individual investors
(5-1 = 4), if contrary, the interests of -15,99, respectively, from This
produces the following benefits matrix:

In this game model, individual investors the same as Pig Game in the pig,
he has a strict priority policy does not collect information --- reap the
profits, in this case, institutional investors, if not to collect and
analyze information, The end result is that everyone's interests are all
zero. And institutional investors to collect and analyze information,
although let individual investors accounted for cheap, but there are
income, so this game iterated strict optimal solution is to collect and
analyze information to institutional investors, individual investors of
institutional investors behavior and follow. Therefore, individual
investors also had a herd behavior of institutional investors.

2.2 The game between the manager

Game between the manager acts more complex, but we can use a simple model
for approximate analysis of it, assuming there are two competing
managers, for the market have generated a manager investment behavior,
are There are two options, to follow or not follow, we assume that the
success rate of this investment strategy P = 0.5, if successful will be
10 the proceeds, if it fails, the loss of production of 10, they can
choose not to follow the investment behavior, use their information in
investment decisions, so the success rate of P2 = 0.7, earnings remain
unchanged. So that we can calculate the expected benefits of various

Following the earnings expectations of I1 = 10 * 0.5 + -10 * 0.5 = 0

Not to follow the income expectations: I2 = 10 * 0.7 + -10 * 0.3 = 4

Last Game was an optimal solution, and this is also an effective solution
is not to follow - not to follow, which is actually based on a rather
idealized assumption that the manager, the utility = income. The matrix
does not reflect the expected benefits described above, the reputation of
managers and compensation considerations, and we can conclude that the
managers, the decision-making errors with other investors Yi Qi wrong
decisions with the individual, its loss is not the same, do not follow
the behavior of decision-making errors, in addition to fund financial
loss, as well as reputation risk, is considered foolish investment
managers, have the possibility of losing their jobs. The professional
managers and job opportunities for reputation concerns will undoubtedly
influence their decision-making position, it must be a manager to replace
the income expectations of the effectiveness of matrix matrix, for
managers, because they do not follow the wrong decisions resulting from
its loss : book losses + managers about their reputation and return loss
= 10 +20 = 30, So we get:

Expectations for the effectiveness of follow u1 = 10 * 0.5 + -10 * 0.5 =

Do not follow the expected utility for the u2 = 10 * 0.7 + -30 * 0.3 =- 2

In this case, follow - follow a game equilibrium, which proved a direct
cause of herding is that in many cases, professional managers will give
up their relatively correct information and investment strategies, try to
follow an unknown investment strategy to achieve the stability of his
career and reputation enhanced.

3 Herd behavior

(1) The "herd behavior" that often abandon their private
information to follow others, this will lead to market information
transmission chain interrupted. However, there are two sides of this
situation: first, the "herd behavior" as a certain convergence,
thus weakening market fundamentals, the role of future price movements.
When investment funds exist "herd behavior", the number of
funds will be trading the same stocks at the same time, the sale of
pressure will exceed the market can provide liquidity, the stock of
excess demand significantly affect the stock price, when the funds were
net sellers of shares When will the prices of these stocks under a
certain range jump; when the funds net bought shares, then these shares
rose sharply in the quarter. Leading to the discontinuity and sharp stock
price movements, destruction of the stable operation of the market.
Second, if the "herd behavior" is on the same basis as
investors responded promptly to information, in this case, the investor
"herd behavior" speed up the absorption rate of share price
information, led to a more effective.

(2) If the "herd behavior" that exceed a certain limit, will
induce another important market for the emergence of the phenomenon of 11
over-reaction. In rising markets (such as the bull market), blind chase
over the limit value, only bubbles; in declining markets (such as the
bear market), blind sell into corrections, can only deepen the crisis.
Investor "herd behavior" led to greater price volatility, so
that the stability of the stock market decline.

(3) all of the "herd behavior" occurs is based on incomplete
information. Therefore, once the information market conditions change,
such as the arrival of new information, "herd behavior" will
collapse. Then from the "herd behavior" caused by the excessive
price rise or fall over, it will stop, or even over in the opposite
direction will return. This means that "herd behavior" with
instability and vulnerability. This is also a direct result of the
financial market price instability and vulnerability.

Herding and marketing

Herd behavior in marketing can be a good technique, also known as herd
transaction method. It refers to members of a clever application of
marketing sheep mentality of customers, encouraging customers to allay
the concern, then rapid decision-making. It applies to all people with a
herd mentality.

The marketing advantages of skills strategy is clear:

1. Can eliminate the concerns of customers, strengthen customer's sense
of security.

2. To customers to generate a sense of urgency that other people have
bought, should not we do not buy a.

3. Can drive purchasing behavior of many people, forming a chain

However, this technique also has certain disadvantages:

1. May make a lot of customers who are buying influence at the expense of
research on the product itself, leading to blind customers to buy. Such
purchases are easily produced in a calm after the psychological regret,
that companies and marketers will inevitably result in unnecessary

2. If you do not have enough marketing experience in the use of this
strategy, it is easy to grasp because of improper, introducing a lot of
people to purchase or provide other evidence, loss, or disclosure of
confidential company information.

Therefore, the application of herding in the marketing process must pay
attention to:

* Must be accurately selected center customers in order to convince other
people to follow the purchase.

* Without divulging company secrets under the premise of introducing to
customers with specific examples, not mere lip service.

* Marketing staff should pay attention to professional ethics, facts can
not be exaggerated to mislead customers, can not be deceived customers
with false information.

* Under normal circumstances, only when customers ask about how many
people buy, the marketing staff will help things along and to introduce
the best results, do not pre-empt the introduction.
* If a customer who is concerned about the purchase, and marketing staff
should highlight a celebrity or an influential person who has purchased,
in order to play authoritative effect of law.

Core concepts: the existence of herd of human psychology, behavior often
produce blind obedience.

Application tips: independent thinking, prudent action; creative and
seize the opportunity.

Application areas: political, economic, and social life, business.

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