Do Women Receive Worse Financial Advice?

84 Pages Posted: 24 Aug 2020 Last revised: 18 Jun 2021

See all articles by Utpal Bhattacharya

Utpal Bhattacharya

HKUST Business School

Amit Kumar

The Hong Kong University of Science and Technology

Sujata Visaria

Hong Kong University of Science & Technology (HKUST)

Jing Zhao

Hong Kong Polytechnic University - School of Accounting and Finance

Date Written: December 17, 2020

Abstract

Trained undercover men and women posed as potential clients and visited all 65 local financial advisory firms in Hong Kong. We find that women are more likely than men to receive advice to buy only individual or only local securities. This effect is significant for financial planners, but not for securities firms. Women who signal that they are highly confident, highly risk tolerant, or have a domestic outlook, are especially likely to receive suboptimal advice. Our theoretical model interprets these patterns as an interaction between statistical discrimination and advisors’ incentives. Taste-based discrimination is unlikely to explain the results.

Keywords: audit study, gender, financial advice, securities firm, financial planner, risk tolerance, confidence, geographic outlook

JEL Classification: D14, D91, G11, G24, G41

Suggested Citation

Bhattacharya, Utpal and Kumar, Amit and Visaria, Sujata and Zhao, Jing, Do Women Receive Worse Financial Advice? (December 17, 2020). HKUST Business School Research Paper No. 2020-007 (also appears in Emerging Finance and Financial Practices eJournal), Available at SSRN: https://ssrn.com/abstract=3671377 or http://dx.doi.org/10.2139/ssrn.3671377

Utpal Bhattacharya (Contact Author)

HKUST Business School ( email )

Clear Water Bay
Kowloon
Hong Kong

Amit Kumar

The Hong Kong University of Science and Technology ( email )

Room No 5067. LSK Business Building. Hong Kong Uni
Hong Kong SAR, 000000
Hong Kong

HOME PAGE: http://www.amitkmr.com

Sujata Visaria

Hong Kong University of Science & Technology (HKUST) ( email )

Clearwater Bay
Kowloon, 999999
Hong Kong

Jing Zhao

Hong Kong Polytechnic University - School of Accounting and Finance ( email )

Hung Hom
Kowloon
Hong Kong

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