Dynamic Stock Market Participation of Households with Heterogeneous Participation Costs

Publikation: KonferencebidragPaperForskningpeer review

Resumé

This paper develops and estimates a dynamic model of stock market participation, where consumers’ decisions regarding stock market participation are influenced by participation costs. The practical significance of the participation costs is considered as being a channel through which financial education programs can affect consumers’ investment decisions. Using household data from the Panel Study of Income Dynamics, I estimate the magnitude of the participation cost, allowing for individual heterogeneity
in it. The results show the average stock market participation cost is about 5% of labor income; however, it varies substantially over consumers’ life. The model successfully predicts the level of the observed participation rate and the increasing pattern of stock market participation over the consumers’ life cycle.
OriginalsprogEngelsk
Publikationsdato2012
Antal sider32
StatusUdgivet - 2012
BegivenhedThe 39th European Finance Association Annual Meeting (EFA 2012) - Copenhagen Business School, Frederiksberg, Danmark
Varighed: 15 aug. 201218 aug. 2012
Konferencens nummer: 39
http://www.efa2012.org/

Konference

KonferenceThe 39th European Finance Association Annual Meeting (EFA 2012)
Nummer39
LokationCopenhagen Business School
LandDanmark
ByFrederiksberg
Periode15/08/201218/08/2012
Internetadresse

Emneord

  • Stock Market Participation
  • Dynamic Models
  • Discrete Choice Models

Citer dette

Khorunzhina, N. (2012). Dynamic Stock Market Participation of Households with Heterogeneous Participation Costs. Afhandling præsenteret på The 39th European Finance Association Annual Meeting (EFA 2012), Frederiksberg, Danmark.
Khorunzhina, Natalia. / Dynamic Stock Market Participation of Households with Heterogeneous Participation Costs. Afhandling præsenteret på The 39th European Finance Association Annual Meeting (EFA 2012), Frederiksberg, Danmark.32 s.
@conference{b985da47dfae409285c6152896cf5897,
title = "Dynamic Stock Market Participation of Households with Heterogeneous Participation Costs",
abstract = "This paper develops and estimates a dynamic model of stock market participation, where consumers’ decisions regarding stock market participation are influenced by participation costs. The practical significance of the participation costs is considered as being a channel through which financial education programs can affect consumers’ investment decisions. Using household data from the Panel Study of Income Dynamics, I estimate the magnitude of the participation cost, allowing for individual heterogeneityin it. The results show the average stock market participation cost is about 5{\%} of labor income; however, it varies substantially over consumers’ life. The model successfully predicts the level of the observed participation rate and the increasing pattern of stock market participation over the consumers’ life cycle.",
keywords = "Stock Market Participation, Dynamic Models, Discrete Choice Models",
author = "Natalia Khorunzhina",
year = "2012",
language = "English",
note = "null ; Conference date: 15-08-2012 Through 18-08-2012",
url = "http://www.efa2012.org/",

}

Khorunzhina, N 2012, 'Dynamic Stock Market Participation of Households with Heterogeneous Participation Costs' Paper fremlagt ved The 39th European Finance Association Annual Meeting (EFA 2012), Frederiksberg, Danmark, 15/08/2012 - 18/08/2012, .

Dynamic Stock Market Participation of Households with Heterogeneous Participation Costs. / Khorunzhina, Natalia.

2012. Afhandling præsenteret på The 39th European Finance Association Annual Meeting (EFA 2012), Frederiksberg, Danmark.

Publikation: KonferencebidragPaperForskningpeer review

TY - CONF

T1 - Dynamic Stock Market Participation of Households with Heterogeneous Participation Costs

AU - Khorunzhina, Natalia

PY - 2012

Y1 - 2012

N2 - This paper develops and estimates a dynamic model of stock market participation, where consumers’ decisions regarding stock market participation are influenced by participation costs. The practical significance of the participation costs is considered as being a channel through which financial education programs can affect consumers’ investment decisions. Using household data from the Panel Study of Income Dynamics, I estimate the magnitude of the participation cost, allowing for individual heterogeneityin it. The results show the average stock market participation cost is about 5% of labor income; however, it varies substantially over consumers’ life. The model successfully predicts the level of the observed participation rate and the increasing pattern of stock market participation over the consumers’ life cycle.

AB - This paper develops and estimates a dynamic model of stock market participation, where consumers’ decisions regarding stock market participation are influenced by participation costs. The practical significance of the participation costs is considered as being a channel through which financial education programs can affect consumers’ investment decisions. Using household data from the Panel Study of Income Dynamics, I estimate the magnitude of the participation cost, allowing for individual heterogeneityin it. The results show the average stock market participation cost is about 5% of labor income; however, it varies substantially over consumers’ life. The model successfully predicts the level of the observed participation rate and the increasing pattern of stock market participation over the consumers’ life cycle.

KW - Stock Market Participation

KW - Dynamic Models

KW - Discrete Choice Models

M3 - Paper

ER -

Khorunzhina N. Dynamic Stock Market Participation of Households with Heterogeneous Participation Costs. 2012. Afhandling præsenteret på The 39th European Finance Association Annual Meeting (EFA 2012), Frederiksberg, Danmark.