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This study analyzes the impact of broadband access on household investments in high-risk assets by employing the Double/Debiased Machine Learning-based Difference-in-Difference (DMLDiD) method. The results demonstrate a significant increase in these investments, propelled by enhanced broadband access. This increase is particularly evident among younger, more educated households in urban areas and Eastern regions, highlighting broadband’s influence on financial behaviors across diverse demographics. The study’s novel implementation of the DMLDiD approach in analyzing household behavior enhances the current literature. It provides a comprehensive view of the influence of digital infrastructure on economic decisions across various demographic segments. This research enhances comprehension of the multifaceted effects of technology on household financial strategies, highlighting the necessity of targeted digital infrastructure development. JEL Classification: D14, G11, O33.

In this paper, expected utility, defined by a Taylor series expansion around expected wealth, is maximized. The coefficient of relative risk aversion (CRRA) that is commensurate with a 100% investment in the risky asset is simulated. The following parameters are varied: the riskless return, the market standard deviation, the market stock premium, and the skewness and the kurtosis of the risky return. Both the high extremes and the low extremes are considered. With these figures, the upper bound of the market CRRA is 3.021 and the lower bound is 0.466. Log utility, which corresponds to a CRRA of 1, is not excluded.

Although household savings in Japan are among the highest in the world, investment in risky assets is still very low. This study examines whether financial literacy explains the lack of investment in risky assets in Japan. We use data from the Preference Parameter Study, a nationwide survey in Japan that has been conducted by Osaka University. We use investment in stocks, investment trusts, futures/options, Japanese government bonds, government bonds of foreign countries, and foreign currency deposits as a proxy for investment in risky assets. Our results show that investment in risky assets is higher among financially literate people. Moreover, financial literacy has a significantly positive association with investment in risky assets even after controlling the demographic, socio-economic, and psychological factors. We check the robustness of the association between financial literacy and investment in risky assets by segregating investment in risky assets into investment in equity securities and investment in bonds and foreign currencies. Financial literacy is found to be associated with both investment in equity securities and investment in bonds and foreign currencies. Our results are also robust in terms of the endogeneity issue. The results imply that investment in risky assets in financial markets could be increased by introducing financial literacy programs at a mass level.

This paper reexamines the question of gender differences in financial relative risk aversion using updated methods and data. Specifically, the paper revisits the 1998 work “Are women more risk averse?” by Jianakoplos and Bernasek, suggests refinements in their model in relation to the database used, namely the U.S. Federal Reserve Board’s Survey of Consumer Finances (SCF), and performs new tests on the latest SCF from 2022. The suggested refinements pertain first to an enhanced computation of wealth, which includes additional categories of assets such as 401(k)s or other thrift savings accounts, and second to the more subtle handling and consideration of specific demographic data of the SCF respondents. Unlike the original study, which also included married couples, the new study focuses exclusively on single-headed (never-married) households. This eliminates ambiguity about the actual financial decision maker in households, enabling a clearer assessment of individual gendered behavior. Following the refinements, the new tests reveal a continuing pattern of decreasing relative risk aversion; however, contrary to the 1998 findings, there is no significant gender difference in financial relative risk aversion in 2022. This study also documents that education levels strongly influence risk-taking: single women with higher education levels are more likely to hold risky assets, while for men, higher education correlates with less risk-taking. The paper concludes by informing policymakers and financial educators so as to further tailor their strategies for promoting gender equality in financial decision-making.

In 2010, Google withdrew from mainland China unexpectedly, which is an important issue that significantly changed the information acquisition environment in China. After that, Baidu has dominated a search engine in China, which provides less informative results. We use Google’s withdrawal from mainland China as a quasi-experiment and the data from Chinese General Social Survey (CGSS) to test the relationship between the information searching in new media and household investment in risky assets. By using the difference-in-difference method, we find that Google’s withdrawal from mainland China significantly decreased households’ willingness to invest in risky assets. The results are robust after parallel trend test, PSM–DID, entropy balancing, placebo test, as well as changing the control and treatment group, using a Logit model and excluding other factors. As for the heterogeneity, the effects are different among females and males, rural and urban residents, and residents with different incomes. As for the plausible channels, we find that Google’s withdrawal from mainland China significantly affected firms’ information disclosure quality, the convenience of getting information and the risk preference, by which their investment behaviors are affected.

The digital transformation of education is an inevitable trend, characterized by the deep integration of digital technologies within educational frameworks, making it a crucial driver of educational innovation and reform. Using data from the 2019 China Household Finance Survey, this study empirically examines the effects of digital education on household allocation of risky financial assets, incorporating both mechanistic and heterogeneity analyses. The findings reveal that digital education significantly enhances both the scope and intensity of household engagement with risky financial assets. After addressing endogeneity concerns using instrumental variable techniques and conducting extensive robustness checks, the results consistently validate the initial findings. Furthermore, the impact of digital education on the allocation of risky financial assets varies across different household demographics, with a more pronounced effect observed in households with greater wealth, lower debt ratios, and urban residency. Additionally, the mechanistic analysis clarifies how digital education facilitates the allocation of risky financial assets by broadening access to information, improving financial literacy, and increasing risk tolerance. Overall, this paper underscores the crucial role of digital education in shaping household financial asset allocation.

Perception of risk in the context of how a person considers a decision as a risk, either low or high and how much return they expect to get by holding to a certain level of risk, will influence one's decision-making. Likewise, decisions on ownership of financial assets have different risk spectrums based on the risk-return tradeoff. Religiosity, understanding and practicing religious teachings also influence decision-making, including financial decisions. Religious Muslim investors tend to avoid the ownership of high-risk assets. This paper aims to investigate the relationship between the newly synthesized variables, namely the perception of risk based on religious teachings and the ownership of risky financial assets for young individual investors. For this purpose, using the snowball sampling method, we conducted a survey through distribution of questionnaire and obtained 123 respondents. We then performed correlation analysis and SEM-PLS. The results showed that age is correlated and positively affects asset holding decisions. It means that the older the investor, the greater the ownership of risky assets. However, gender and Risk-Religion Perception (RRP) are correlated and have a significant negative effect. Male investors are more prepared and braver to hold risky assets. These also confirmed that investors who internalize religious teachings are more likely to be risk-averse than risk-neutral.

Hart (J Polit Econ, 119(4):617–638, 2011) argues that the Aumann and Serrano (J Polit Econ, 116(5):810–836, 2008) and Foster and Hart (J Polit Econ, 117(5):785–814, 2009) measures of riskiness have an objective and universal appeal with respect to a subset of expected utility preferences, UH . We show that mean-riskiness decisionmaking criteria using either measure violate expected utility and are generally inconsistent with optimal portfolio choices made by investors with preferences in UH . We also demonstrate that riskiness measures satisfying Hart’s other behavioral requirements do not generally exist when his argument is generalized to incorporate non-expected utility preferences. Finally, we identify other attributes of the Aumann-Serrano and Foster-Hart measures that raise concerns over their operationalizability and usefulness in various decision making, risk management, and risk assessment settings.

The goal of this study is to understand how the households decide on portfolio asset allocation when the husband and wife have different risk preferences. Using data from the Health and Retirement Study for 1992–2006, we show that the share of risky assets in portfolios of two-person households increases with the risk tolerance of the spouse who has more bargaining power. The risk tolerance of the spouse who has less bargaining power does not seem to affect the share of household wealth allocated to risky assets. These results are consistent with a cooperative bargaining framework where the investment in risky assets depends on the bargaining power of the more risk tolerant spouse.

Drawing upon data from the European Commission's consumer survey, this paper examines how four types of household expectations affect household financial portfolio decisions in the three largest euro area countries: Germany, France, and Italy. Focus is placed on the dynamic response of the shares of safe (currency and transferable deposits) and risky (equity and investment fund shares) financial assets in relation to the total value of financial assets held by the household sector to the shocks in expectations. The results illustrate that expectations are an important determinant of household financial portfolio decisions. In general, in response to improved expectations, households increase the share of risky assets and reduce the share of safe assets. However, country and expectations-type specific differences were observed. The effects of income, prices level, deposit rate and stock price shocks on the household financial portfolio are also documented and compared and the economic policy and financial industry implications of the results are discussed.