With the convergence of investment projects in China,this paper applies the game theory and the Bayes’ Method to the analysis of the deep causes from the perspective of herding behavior.Prospect theory of management science is introduced into investment field and it is considered that the incentive of investment is decided by profit and expected value.The theoretical model study results indicate that the entrepreneur’s incentive of investment is decided by profit in economic prosperity period as optimistic emotion spreading,and entrepreneurs will invest different projects for pursuit of high profits,and there is not any herding behavior.But in depression period,the entrepreneur’s incentive of investment is decided by expected value as gloomy mood spreading,and entrepreneurs will invest same projects,and there will be herding behaviors.Thus,for prevention herding behavior from happening,the entrepreneur’s mentality for quick profits should be adjusted,and incentive mechanism for encouraging innovation should be established.