Household Asset Holding Diversification in Australia

34 Pages Posted: 12 Jul 2014

See all articles by Francesco Mariotti

Francesco Mariotti

Independent

Karen Mumford

University of York (UK); IZA Institute of Labor Economics; CAMA

Yolanda Pena-Boquete

University of Vigo

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Abstract

We explore asset holding diversification by Australian households, in particular, the household asset diversification participation decision (whether or not to diversify at all) is jointly estimated with the decision of how much to diversify. In so doing, recent literature on the modelling of proportions is combined with the growing body of research concerning household financial decision making. Our findings are consistent with the participation of households operating in diverse financial markets being constrained by ineffective information conduits, influencing the decision of whether or not to diversify. We further find that short term concerns over job security or health are associated with less participation in, as well as a lower extent of, asset holding diversification.

Keywords: job insecurity, asset allocation, asset diversification, household finance, employment, Zero-Inflated Beta

JEL Classification: J3, J7

Suggested Citation

Mariotti, Francesco and Mumford, Karen A. and Pena-Boquete, Yolanda, Household Asset Holding Diversification in Australia. IZA Discussion Paper No. 8302. Available at SSRN: https://ssrn.com/abstract=2465337

Francesco Mariotti (Contact Author)

Independent

No Address Available

Karen A. Mumford

University of York (UK) ( email )

Heslington
York YO10 5DD
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

CAMA ( email )

ANU College of Business and Economics
Canberra, Australian Capital Territory 0200
Australia

Yolanda Pena-Boquete

University of Vigo ( email )

E.U. de Enx. Técn. Industrial.
Vigo, E-36200
Spain

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