Trusting the stock market

Arbeitspapier

We provide a new explanation to the limited stock market participation puzzle. In deciding whether to buy stocks, investors factor in the risk of being cheated. The perception of this risk is a function not only of the objective characteristics of the stock, but also of the subjective characteristics of the investor. Less trusting individuals are less likely to buy stock and, conditional on buying stock, they will buy less. The calibration of the model shows that this problem is sufficiently severe to account for the lack of participation of some of the richest investors in the United States as well as for differences in the rate of participation across countries. We also find evidence consistent with these propositions in Dutch and Italian micro data, as well as in cross country data.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: CFS Working Paper ; No. 2005/27

Klassifikation und Themen

• Klassifikation: Wirtschaft
• Thema: Stock Market Participation ; Trust ; Portfolio Choice ; Portfolio-Management ; Anlageverhalten ; Vertrauen ; Schätzung ; Italien ; Niederlande

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Haliassos, Michael ; Reiter, Michael
• Ereignis: Veröffentlichung
• (wer): Goethe University Frankfurt, Center for Financial Studies (CFS)
• (wo): Frankfurt a. M.
• (wann): 2005

Weitere Informationen

• Handle: http://hdl.handle.net/10419/25463
• URN: urn:nbn:de:hebis:30-23396
• Letzte Aktualisierung: 10.03.2025, 11:43 MEZ