Who lost the most? Financial literacy, cognitive abilities, and the financial crisis

Arbeitspapier

We study how and to what extent private households are affected by the recent financial crisis and how their financial decisions are influenced by this shock. Our analysis reveals that individuals with low levels of financial literacy are less likely to have invested in the stock market and thus are less likely to report losses in wealth. Yet, individuals with low financial literacy are more likely to sell their assets which lost in value (realize losses). This reaction to short-term losses has potential long-term consequences if individuals do not participate in markets' recovery and face lower returns in the long run.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: ECB Working Paper ; No. 1299

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making‡ ; Household Saving; Personal Finance ; Portfolio Choice; Investment Decisions
• Thema: cognitive ability ; financial crisis ; financial literacy ; life-cycle savings ; Portfolio Choice ; saving behavior

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Bucher-Koenen, Tabea ; Ziegelmeyer, Michael
• Ereignis: Veröffentlichung
• (wer): European Central Bank (ECB)
• (wo): Frankfurt a. M.
• (wann): 2011

Weitere Informationen

• Handle: http://hdl.handle.net/10419/153733
• Letzte Aktualisierung: 10.03.2025, 11:46 MEZ