The Effect of Education on Equity Holdings

33 Pages Posted: 22 Mar 2010

See all articles by Dmytro Hryshko

Dmytro Hryshko

University of Alberta

Maria Jose Luengo-Prado

Indus Center for Academic Excellence

Bent E. Sørensen

University of Houston - Department of Economics; Centre for Economic Policy Research (CEPR)

Multiple version iconThere are 2 versions of this paper

Date Written: March 10, 2010

Abstract

We study the effect of education on equity ownership in the form of stocks or mutual funds (outside of retirement accounts). Using data from the Panel Study of Income Dynamics, we find a causal effect of education on stockholding using the number of colleges in the county where the respondent grew up as an instrument. The effect is particularly strong for whites from non-privileged backgrounds. We explore the channels through which education affects equity holdings using the Wisconsin Longitudinal Survey and find that, controlling for family fixed effects, gaining a white-collar job appears to be the main channel.

Keywords: portfolio choice, college openings

JEL Classification: G11

Suggested Citation

Hryshko, Dmytro and Luengo-Prado, Maria Jose and Sorensen, Bent E., The Effect of Education on Equity Holdings (March 10, 2010). Available at SSRN: https://ssrn.com/abstract=1573525 or http://dx.doi.org/10.2139/ssrn.1573525

Dmytro Hryshko

University of Alberta ( email )

Edmonton, Alberta T6G 2R3
Canada

Maria Jose Luengo-Prado

Indus Center for Academic Excellence ( email )

Bent E. Sorensen (Contact Author)

University of Houston - Department of Economics ( email )

204 McElhinney Hall
Houston, TX 77204-5882
United States
713-743-3841 (Phone)
713-743-3798 (Fax)

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

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