Gender differences in risky asset behavior: The importance of self-confidence and financial literacy

Andrej Cupák; Pirmin Fessler; Alyssa Schneebaum

doi:10.1016/j.frl.2020.101880

Gender differences in risky asset behavior: The importance of self-confidence and financial literacy

Andrej Cupák
, Pirmin Fessler
, Alyssa Schneebaum^*

^*Corresponding author for this work

National Bank of Slovakia
University of Economics in Bratislava
Oesterreichische Nationalbank
Vienna University of Economics and Business

Research output: Contribution to journal › Article › peer-review

Abstract (may include machine translation)

This paper studies the role of individuals’ confidence in own financial literacy in explaining the gender gap in investment in risky assets, while controlling for actual financial literacy and risk aversion. It is the first paper to assess the role of confidence independent of actual financial knowledge for a large set of countries and it is the first to explore the role of confidence by using counterfactual decomposition techniques. Results from our analysis confirm recent findings of modern behavioral finance: confidence is a strong determinant of risky financial behavior and accounts for a large part of the gender gap.

Original language	English
Article number	101880
Number of pages	6
Journal	Finance Research Letters
Volume	42
DOIs	https://doi.org/10.1016/j.frl.2020.101880
State	Published - Oct 2021
Externally published	Yes

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 5 Gender Equality

Keywords

decomposition
financial behavior
financial literacy
gender
self-confidence

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10.1016/j.frl.2020.101880License: CC BY-NC-ND

Fessler-Pirmin_2021-10Publisher version, 0.98 MBLicense: CC BY-NC-ND

Cite this

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title = "Gender differences in risky asset behavior: The importance of self-confidence and financial literacy",

abstract = "This paper studies the role of individuals{\textquoteright} confidence in own financial literacy in explaining the gender gap in investment in risky assets, while controlling for actual financial literacy and risk aversion. It is the first paper to assess the role of confidence independent of actual financial knowledge for a large set of countries and it is the first to explore the role of confidence by using counterfactual decomposition techniques. Results from our analysis confirm recent findings of modern behavioral finance: confidence is a strong determinant of risky financial behavior and accounts for a large part of the gender gap.",

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year = "2021",

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AU - Cupák, Andrej

AU - Fessler, Pirmin

AU - Schneebaum, Alyssa

PY - 2021/10

Y1 - 2021/10

N2 - This paper studies the role of individuals’ confidence in own financial literacy in explaining the gender gap in investment in risky assets, while controlling for actual financial literacy and risk aversion. It is the first paper to assess the role of confidence independent of actual financial knowledge for a large set of countries and it is the first to explore the role of confidence by using counterfactual decomposition techniques. Results from our analysis confirm recent findings of modern behavioral finance: confidence is a strong determinant of risky financial behavior and accounts for a large part of the gender gap.

AB - This paper studies the role of individuals’ confidence in own financial literacy in explaining the gender gap in investment in risky assets, while controlling for actual financial literacy and risk aversion. It is the first paper to assess the role of confidence independent of actual financial knowledge for a large set of countries and it is the first to explore the role of confidence by using counterfactual decomposition techniques. Results from our analysis confirm recent findings of modern behavioral finance: confidence is a strong determinant of risky financial behavior and accounts for a large part of the gender gap.

KW - decomposition

KW - financial behavior

KW - financial literacy

KW - gender

KW - self-confidence

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JO - Finance Research Letters

JF - Finance Research Letters

M1 - 101880

ER -

Gender differences in risky asset behavior: The importance of self-confidence and financial literacy

Abstract (may include machine translation)

UN SDGs

Keywords

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