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Financial decisions of minorities post-2008

Author

Listed:
  • Bonaparte, Yosef
  • Khalaf, Sarah
  • Korniotis, George M.

Abstract

We study the financial behavior of minorities over 2007-09. We find that after 2008 and compared to White Americans, African Americans and Hispanics have a higher propensity to increase risk tolerance, optimism, and allocations to risky assets and lower probability of exiting the stock market. These findings cannot be explained by changes in wealth or income, and we speculate that they may be due to the positive effects of the election of President Obama. Specifically, we find that the change in behavior by minorities from 2007 to 2009 is consistent with minorities updating their beliefs about future economic outcomes.

Suggested Citation

  • Bonaparte, Yosef & Khalaf, Sarah & Korniotis, George M., 2023. "Financial decisions of minorities post-2008," Journal of Banking & Finance, Elsevier, vol. 149(C).
    • Handle: RePEc:eee:jbfina:v:149:y:2023:i:c:s0378426623000365
    DOI: 10.1016/j.jbankfin.2023.106811
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    1. Gan, Hongwu & Lu, Shengfeng & Lu, Weijie & Niu, Geng & Zhou, Yang, 2023. "Beauty and stock market participation," Journal of Banking & Finance, Elsevier, vol. 155(C).

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    More about this item

    Keywords

    Risk tolerance; Optimism; Stock ownership; Asset allocation; Wealth gap; SCF; Presidential elections;
    All these keywords.

    JEL classification:

    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination

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