Abstract

http://ssrn.com/abstract=2114867
 
 

Citations (4)



 
 

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Understanding Peer Effects in Financial Decisions: Evidence from a Field Experiment


Leonardo Bursztyn


University of California, Los Angeles (UCLA) - Anderson School of Management

Florian Ederer


Yale School of Management; Yale University - Cowles Foundation

Bruno Ferman


Sao Paulo School of Economics - FGV

Noam Yuchtman


University of California, Berkeley - Haas School of Business

July 2012

NBER Working Paper No. w18241

Abstract:     
Using a high-stakes field experiment conducted with a financial brokerage, we implement a novel design to separately identify two channels of social influence in financial decisions, both widely studied theoretically. When someone purchases an asset, his peers may also want to purchase it, both because they learn from his choice ("social learning") and because his possession of the asset directly affects others' utility of owning the same asset ("social utility"). We find that both channels have statistically and economically significant effects on investment decisions. These results can help shed light on the mechanisms underlying herding behavior in financial markets.

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Number of Pages in PDF File: 82

working papers series


Date posted: July 21, 2012  

Suggested Citation

Bursztyn, Leonardo and Ederer, Florian and Ferman, Bruno and Yuchtman, Noam, Understanding Peer Effects in Financial Decisions: Evidence from a Field Experiment (July 2012). NBER Working Paper No. w18241. Available at SSRN: http://ssrn.com/abstract=2114867

Contact Information

Leonardo Bursztyn (Contact Author)
University of California, Los Angeles (UCLA) - Anderson School of Management ( email )
110 Westwood Plaza
Los Angeles, CA 90095-1481
United States
Florian Ederer
Yale School of Management ( email )
135 Prospect Street
P.O. Box 208200
New Haven, CT 06520-8200
United States
HOME PAGE: http://faculty.som.yale.edu/florianederer/

Yale University - Cowles Foundation ( email )
Box 208281
New Haven, CT 06520-8281
United States

Bruno Ferman
Sao Paulo School of Economics - FGV ( email )
Rua Itapeva n 474
Sao Paulo, DC 01332-000 20052
Brazil
HOME PAGE: http://https://sites.google.com/site/brunoferman/
Noam Yuchtman
University of California, Berkeley - Haas School of Business ( email )
545 Student Services Building
Berkeley, CA 94720
United States
Feedback to SSRN


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Citations:  4
Footnotes:  48

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