Valuing Peace: The Effects of Financial Market Exposure on Votes and Political Attitudes

76 Pages Posted: 16 Jan 2016 Last revised: 16 Mar 2018

Saumitra Jha

Stanford Graduate School of Business

Moses Shayo

The Hebrew University of Jerusalem - Department of Economics

Date Written: February 11, 2018

Abstract

Financial markets expose individuals to the broader economy. Does participation in fi nancial markets also lead individuals to re-evaluate the costs of conflict, their views on politics and even their votes? Prior to the 2015 Israeli elections, we randomly assigned fi nancial assets from Israeli and Palestinian companies to likely voters and gave them incentives to actively trade for up to seven weeks. Opportunities to trade in fi nancial markets systematically shifted vote choices and increased support for peace initiatives. These effects persist a year after the experiment, and appear consistent with fi nancial market exposure leading to increased awareness of the economic risks of conflict.

Keywords: Financial Markets, Conflict, Peace, Political Economy

JEL Classification: C93, D72, D74, N2, O12

Suggested Citation

Jha, Saumitra and Shayo, Moses, Valuing Peace: The Effects of Financial Market Exposure on Votes and Political Attitudes (February 11, 2018). Stanford University Graduate School of Business Research Paper No. 16-7. Available at SSRN: https://ssrn.com/abstract=2716660 or http://dx.doi.org/10.2139/ssrn.2716660

Saumitra Jha (Contact Author)

Stanford Graduate School of Business ( email )

655 Knight Way
Stanford, CA 94305-5015
United States

Moses Shayo

The Hebrew University of Jerusalem - Department of Economics ( email )

Mount Scopus
Jerusalem, IL 91905
Israel

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