Temperance in Stock Market Participation: Evidence from France

Economica - Tập 77 Số 306 - Trang 314-333 - 2010
Luc Arrondel1, Hector Calvo-Pardo2, Xisco Oliver3
1CNRS‐PSE
2University of Southampton *
3Universitat de les Illes Balears

Tóm tắt

We explore empirically whether earnings uncertainty and borrowing constraints deter households from the stock market, consistent with the predictions of theoretical studies of portfolio choice in the presence of uninsurable earnings. Since recent extensions highlight the importance of the correlation between earnings and financial risks, here we use a self‐assessed proxy from the DELTA‐TNS 2002 cross‐sectional survey to empirically assess the impact. Although income risk does not affect the participation decision of households' reporting a negative correlation, it does lower the participation of those who report a non‐negative sign, consistent with economic theory predictions.

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Thông tin xuất bản

Economica

Tập 77 Số 306

314-333

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