27 Pages Posted: 15 Mar 2010
Date Written: September 1, 2009
Using the Panel Study of Income Dynamics, we document that, controlling for observable characteristics, household investors' likelihood of entering the stock market within the next five years is about 30 percent higher if their parents or children had entered the stock market during the previous five years. By eliminating competing hypotheses such as preference similarity and herding, we argue that these findings highlight the significance of information sharing regarding household financial decisions.
Keywords: Information sharing, Stock market participation, Extended families
JEL Classification: D14, D83, G11
Suggested Citation: Suggested Citation
Li, Geng, Information Sharing and Stock Market Participation: Evidence from Extended Families (September 1, 2009). Available at SSRN: https://ssrn.com/abstract=1569172 or http://dx.doi.org/10.2139/ssrn.1569172