Windfall gains and stock market participation

• 成果类型: Article
• 署名作者: Briggs, Joseph; Cesarini, David; Lindqvist, Erik; Ostling, Robert
• 署名单位: Federal Reserve System - USA; Federal Reserve System Board of Governors; New York University; National Bureau of Economic Research; Stockholm University; Research Institute of Industrial Economics (IFN); Stockholm School of Economics
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2020.07.014
• 发表日期: 2021
• 页码: 57-83
• 关键词: Household saving and personal finance; Intertemporal consumer choice; Portfolio choice and investment decisions

摘要

We exploit the randomized assignment of lottery prizes in a large administrative Swedish data set to estimate the causal effect of wealth on stock market participation. A $150,00 0 windfall gain increases the stock market participation probability by 12 percentage points among prelottery nonparticipants but has no discernible effect on prelottery stock owners. A structural life cycle model significantly overpredicts entry rates even for very high entry costs (up to $31,0 00). Additional analyses implicate pessimistic beliefs regarding equity returns as a major source of this overprediction and suggest that both recent and early-life return realizations affect beliefs. Published by Elsevier B.V.