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Household portfolios in Japan

  • Iwaisako, Tokuo
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    I provide a detailed description and in-depth analysis of household portfolios in Japan. (1) It is shown that the share of equities in financial wealth and the stock market participation of Japanese households decreased throughout the 1990s. (2) Using survey data, age-related variations in the share of stocks in financial wealth are analyzed. The equity share and stock market participation increase with age among young households, peaking when people reach their 50s, and then stabilizing. However, the share of equities conditional on ownership exhibits no significant age-related pattern, implying that age-related patterns are primarily explained by the decision to hold stocks. A similar mechanism operates to that found in previous studies of Western countries. (3) Owner-occupied housing has a significantly positive effect on stock market participation and on the share of stocks in financial wealth.

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    File URL: http://www.sciencedirect.com/science/article/B6VF1-4WH8C8S-1/2/bfcf1fd979bc41fac6e49e1b62b3fa04
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    Article provided by Elsevier in its journal Japan and the World Economy.

    Volume (Year): 21 (2009)
    Issue (Month): 4 (December)
    Pages: 373-382

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    Handle: RePEc:eee:japwor:v:21:y:2009:i:4:p:373-382
    Contact details of provider: Web page: http://www.elsevier.com/locate/inca/505557

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    1. Horioka, C.Y. & Watanabe, W., 1996. "Why Do People Save? A Micro-Analysis of Motives for Household Saving in Japan," ISER Discussion Paper 0412, Institute of Social and Economic Research, Osaka University.
    2. John Y. Campbell & Joao F. Cocco, 2002. "Household Risk Management and Optimal Mortgage Choice," Harvard Institute of Economic Research Working Papers 1946, Harvard - Institute of Economic Research.
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    4. Cai, Jun & Chan, K C & Yamada, Takeshi, 1997. "The Performance of Japanese Mutual Funds," Review of Financial Studies, Society for Financial Studies, vol. 10(2), pages 237-73.
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    7. French, K.R. & Poterba, J.M., 1990. "Are Japanese Stock Prices Too High?," Working papers 547, Massachusetts Institute of Technology (MIT), Department of Economics.
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    17. Poterba, J.M. & Samwick, A.A., 1996. "Stock Ownership Patterns, Stock Market Fluctuations, and Consumption," Working papers 96-2, Massachusetts Institute of Technology (MIT), Department of Economics.
    18. Hayashi, Fumio, 1995. "Is the Japanese Extended Family Altruistically Linked? A Test Based on Engel Curves," Journal of Political Economy, University of Chicago Press, vol. 103(3), pages 661-74, June.
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