Altruism versus Egoism in Investment Decisions
48 Pages Posted: 3 Jun 2017 Last revised: 7 Aug 2017
Date Written: June 1, 2017
We provide survey evidence that personal values have an impact on individual investment decisions, in particular the decision to invest socially responsible. Our findings show that there is a positive link between altruistic values and the relative importance of social responsibility. This effect is stronger when individuals believe that they can make a positive social or environmental impact with their investments, or when they feel morally obliged to invest responsibly. If altruistic individuals associate responsible investments with higher returns, it decreases their motivation to invest responsibly. Egoistic values are negatively associated with the decision to invest responsibly. Egoism only leads to an increased relative importance of social responsibility when individuals expect higher returns from holding responsible assets.
Keywords: Socially Responsible Investing, Survey, Investment Decisions, Psychological Values
JEL Classification: A13, D64, G11
Suggested Citation: Suggested Citation