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Willingness to take risks for sustainability during the COVID-19 pandemic

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  • Meyer, Julia

Abstract

This paper empirically shows an increase in investor attention to sustainability during the COVID-19 pandemic using various measures of investor sentiment. To understand the drivers of increased interest in sustainability among investors, we use evidence from two experiments conducted before and during the pandemic. Results collected in an investment task reveal that the shift towards sustainable investments during the pandemic is primarily driven by risk-averse individuals and those with pessimistic risk expectations. These findings suggest that investors exhibit a “willingness to take risks” for sustainability during times of crises.

Suggested Citation

  • Meyer, Julia, 2024. "Willingness to take risks for sustainability during the COVID-19 pandemic," Finance Research Letters, Elsevier, vol. 59(C).
    • Handle: RePEc:eee:finlet:v:59:y:2024:i:c:s1544612323011686
    DOI: 10.1016/j.frl.2023.104796
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    More about this item

    Keywords

    Sustainable investments; Pandemic; Risk aversion; Risk expectations;
    All these keywords.

    JEL classification:

    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility

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