Essays in Economic and Financial Decision of Households PDF Download
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Author: Emiel Jerphanion
Publisher:
ISBN: 9789056686277
Category :
Languages : en
Pages : 138
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Book Description
Author: Emiel Jerphanion
Publisher:
ISBN: 9789056686277
Category :
Languages : en
Pages : 138
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Book Description
Author: Cindy K. Soo
Publisher:
ISBN:
Category :
Languages : en
Pages : 168
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Author: Da Ke
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Book Description
My dissertation examines economic determinants of household financial decisions and investor behaviors. It contains three essays. The first essay investigates whether gender norms shape intra-household financial decision making. Analyzing microdata covering more than 30 million U.S. households, I document that families with a financially sophisticated husband are more likely to participate in the stock market than those with a wife of equal financial sophistication. Consistent with the gender norm hypothesis, the baseline effect is attenuated among individuals brought up by working mothers, but becomes stronger among descendants of pre-industrial societies in which women specialized in activities within the home and households with a husband born and raised in a southern state. A randomized controlled experiment further reveals that female identity hinders idea contribution by the wife. In contrast, male identity causes men to be less open to an opposing viewpoint of their wife, even if her proposition in optimal. These things suggest that gender identity norms can have real consequences for household financial well-being. The second essay explores the impact of local agglomeration economies on stock market participation. We find that when the industry in which individuals work is locally agglomerated, they are more likely to participate in the stock market. Further, we show that this relationship is especially strong among skilled workers. We find that the local agglomeration effect is not explained by risk tolerance, worker inertia, or a preference for stocks of firms that are in the same industry as the worker. Instead, our findings are consistent with local agglomeration enhancing human capital and in turn, raising workers' optimal allocations to risky assets. More generally, our analysis underscores the role of geography in shaping human capital and household financial decisions. The third essay examines whether momentum in stock prices is induced by changes in the political environment. We find that momentum profits are concentrated among politically sensitive firms and industries. A trading strategy with a long position in winner portfolios that are politically unfavored and a short position in losers that are politically favored eliminates all momentum profits. Further, our political sensitivity based factor explains 25% (40%) of monthly stock (industry) momentum alphas. Collectively, our results suggest that investor underreaction to political information generates momentum in stock and industry returns.
Author: Vipul Bhatt
Publisher:
ISBN:
Category :
Languages : en
Pages : 95
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Book Description
Abstract: My research emphasizes the role of interrelated preferences in determining economic choices within a household. In this regard, I study both intergenerational interactions (between parents and children) and intragenerational interactions (between spouses). These linkages have important implications on individual economic behavior such as savings, labor supply, investment in human capital, and bequests which in turn affects aggregate savings and growth.
Author: Charline Uhr
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Book Description
Author: Sumit Agarwal
Publisher: Springer Nature
ISBN: 9811555265
Category : Business & Economics
Languages : en
Pages : 352
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Book Description
Household finance studies is a relatively recent field, exploring a growing understanding of how households make financial decisions relating to the functions of consumption, payment, risk management, borrowing and investing; how institutions provide goods and services to satisfy these financial functions of households; and how interventions by firms, governments and other parties affect the provision of financial services. This timely book analyses existing findings about household behavior as well as findings related to policy interventions. With international case studies, this book reviews a topic of global importance and brings a crucial up-to-date survey of the field for researchers and postgraduate students.
Author: Fernando Lopez (Professor of finance)
Publisher:
ISBN:
Category : Electronic dissertations
Languages : en
Pages : 121
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Book Description
This dissertation consists of three essays that examine the determinants of individual financial decision making and the welfare implications of those decisions. In the first essay, I consider an important dimension of individual welfare, namely mental health, to study whether the use of different financial services helped to withstand the damage caused by a large earthquake that hit Chile in February 2010. Using a rich nationally representative panel data set and geographic differences in ground shaking caused by the earthquake as an exogenous source of damage, I find that earthquake insurance reduced the incidence of post-traumatic stress disorder (PTSD) by more than 50% among individuals who lived in properties that were damaged by the earthquake. However, I find no significant effects for the amount of savings and bank relationships. Overall, these results suggest that the welfare impact of financial services is driven by the ability to transfer resources across states of the world, but not through time. In the second essay, I study the extent to which low income students in the U.S. understand and take into consideration the financial aspects of their higher education. Using a rich data set from a large U.S. non-profit organization, I find that low income post-secondary students are poorly informed about three main financial aspects of their higher education: expected income, financing costs and opportunity cost of being enrolled. This result holds for students who are academically talented, have been exposed to financial education (including a semester-long personal finance class) and relevant financial experiences. Furthermore, preliminary results of a randomized controlled trial (N=117) suggest that an hour-long financial education workshop on the main financial aspects of college increases students' GPA by 0.2 points (p-value=0.15) and their ability to receive financial aid from the non-profit organization by 11.4 percentage points (p-value=0.25). Overall, these results suggest that (lack of) financial literacy can affect both educational attainment and financial outcomes of low income post-secondary students. In the third essay, I study if civic capital, defined as the set of values and beliefs within a community that promote cooperation for socially valuable purposes (Guiso, Sapienza and Zingales, 2011), affects the use of deposit accounts among Chilean households. Using an institutional setting of limited supply side barriers for access to deposit accounts and a rich household data set, I find that households from areas with higher levels of civic capital, measured as the rate of registration to vote, are more likely to have savings accounts and hold larger amounts in those accounts. This association is stronger for households that are less educated and less intensive users of communication and information devices such as phone, computer and the internet. These results are consistent with the idea that civic capital helps to overcome educational and informational barriers that limit the demand for deposit accounts.
Author: George Simon Mihaylov
Publisher:
ISBN:
Category : Households
Languages : en
Pages : 290
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Book Description
The thesis examines the consequences of household and individual financial decision making in three different areas: mortgages, superannuation and family businesses. The questions posed in each case cannot be tackled using conventional financial databases. I therefore address each case by applying survey methods. First, I examine the socioeconomic impacts of households choosing to take out shared appreciation mortgages (SAMs). Tax and regulatory barriers have impeded the development and use of SAMs in many mortgage markets. Empirical studies on household impacts stemming from SAMs have therefore also been limited. However, the State Government of South Australia has implemented SAMs as a means of enabling and encouraging low-income homeownership, thereby creating a unique dataset of SAM financed households. I survey this population, finding that SAM borrowers benefit from increased budgetary expenditure on discretionary items following take-up, while simultaneously saving on some non-discretionary items relative to control samples of renters and other homeowners from the general population. Furthermore, SAM homeownership also appears to be associated with increased levels of neighbourhood satisfaction and community involvement for borrowers. The results from this study indicate that SAM financed homeownership leads to changes in household behaviour and deserves further consideration by the housing industry and research community. Second, I examine the influence of investor knowledge and the cognitive bias which arises from overconfidence on the advice seeking behaviour of investors in self-managed superannuation funds (SMSFs). I trace whether overestimating one's own technical and financial abilities can hinder the willingness to seek advice. I identify a subset of investors who are not knowledgeable and yet do not seek advice to compensate for this. These investors appear to be overconfident in their ability to manage their SMSF, despite holding under-diversified and less financially sophisticated portfolios when compared to their peers. Given the global rise in investors choosing to manage their own retirement funds and the importance of seeking advice in this context, there are direct policy implications from these findings. They suggest a need to identify and target self-managed retirement investors who display overconfidence since they are the most likely to manage under-performing SMSFs in the longer term. Third, I examine links between the succession planning decisions, operational management and financial performance of small-to-medium sized agricultural enterprises (SMAEs). I differentiate between written, verbal and other succession arrangements to investigate how each type embeds within the broader operational environment of SMAE households. Further tests are performed to see if differences in financial outcomes can be linked with a particular approach to succession. The results indicate that succession planning decisions are positively associated with the use of written business plans and crop insurance, but that this is only true for SMAEs with professionalised written succession arrangements. This was also the only cohort associated with improved return on assets relative to peer agricultural businesses with alternative succession arrangements in place. Given the critical role of succession in the long-term sustainability of family business households, these results have direct implications for farmers and practitioners advising the private agricultural sector. They suggest that the value in planning succession at least partly lies in the value of going down pathways for professionalization.
Author: Michael S. Finke
Publisher:
ISBN:
Category : Electronic Dissertations
Languages : en
Pages : 110
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Book Description
This dissertation examines household characteristics the impact financial decision making. The first essay explores the role of cognitive ability in numeracy, risk tolerance, credit decisions, wealth and retirement savings and asset allocation and finds that cognitive ability is an important predictor of financial decisions. The second essay develops a new instrument to measure time discounting and models asset accumulation and asset allocation and finds that a factor score of intertemporal behaviors is significantly related to both asset accumulation and asset allocation. The third essay documents the decline in basic financial knowledge among households over 60 using a new financial literacy instrument developed to more accurately capture a household's ability to make effective balance sheet, credit, investment, and insurance choices.
Author: Hui Wang
Publisher:
ISBN:
Category : Commercial loans
Languages : en
Pages :
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Book Description
This dissertation has two essays which lie at the intersection of household finance and corporate finance. The topics include household leverage and human capital investment, and cross-holding and corporate borrowing. The essays hope to provide empirical analysis to better understand the economic decision made by both individuals and firms in practice. The first essay is “Household Financial Leverage and Human Capital Investment”. In this study, I find that household leverage has a hump-shaped effect on individual’s incentive to invest in human capital. Using the comprehensive information from the National Longitudinal Survey of Youth, I identify human capital investment decision based on whether an individual requests and participates in on-career skill acquisition training, and estimate household leverage based on the detailed debt and asset information. To strengthen causal inferences, I construct an instrumental variable based on changes in household’s mortgage burden relative to home value resulting from plausibly exogenous housing price fluctuations across regions and over time. Overall, this study highlights the effect of household leverage on human capital investment, which provides valuable implications for decisions of both individuals and macro policymakers. The second essay is “Networking Behind the Scenes: Institutional Cross-industry Holdings and Information Frictions in Corporate Loans”, joint with Jie He, Lantian Liang, and Han Xia. In this research, we study the role played by institutional investors in shaping firms’ cost of borrowing through affecting borrowers’ information friction in corporate loan market. We find that borrowers linked to banks other than the existing lenders through cross-holdings enjoy significantly lower loan spreads. This finding is mostly driven by institutions transmitting information between portfolio firms and banks, which mitigates information frictions and thereby reduces firms’ borrowing costs. For identification, we adopt a difference-in-differences method based on the quasi-natural experiment of financial institution mergers. Our evidence highlights an important effect of institutions’ cross-industry holdings on the corporate loan market.
