Can financial consumer protection promote residents' stock market participation? An investigation based on eastern China residents survey

The phenomenon of limited stock market participation among residents has persisted for a long time. Researchers have extensively explored ways to mitigate this phenomenon from different perspectives, with limited attention on the role of financial consumer protection. To address this gap, this paper utilizes a 2022 resident survey in six provinces in Eastern China to examine the impact of financial consumer protection on Chinese residents' stock market participation. Key findings include: (1) Financial consumer protection significantly and positively influences Chinese residents' stock market participation. (2) Heterogeneity analysis reveals a more pronounced promotional effect among rural, female, and lower-educated residents. (3) Moderation effect analysis indicates a diminishing effect with improved social networks, increased financial knowledge, and enhanced internet usage frequency. (4) Mechanism analysis suggests that financial consumer protection promotes stock market participation by increasing social trust, improving investment expectations, and enhancing self-efficacy. This paper provides valuable insights for promoting residents' stock market participation and advancing financial consumer protection, contributing to the scholarly discourse on this intriguing subject.