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Is stock investment contagious among siblings?

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  • Kiichi Tokuoka

    (Ministry of Finance)

Abstract

A household may learn the importance of stock investment from its siblings. Using the logit and probit models, this paper tests empirically the learning hypothesis that a household is more likely to purchase stocks if its siblings have bought stocks, and finds evidence for the hypothesis. The estimates obtained in the analysis imply that a household’s probability of stock purchases increases by about 1–3 % points if a sibling has purchased stocks. The positive results are not due to alternative explanations, such as uncontrolled correlation of age effects, financial support from siblings, common shocks, or other unobservable correlations. Moreover, the analysis does not support the objection that the positive results may be due to the effects of genes or common parenting.

Suggested Citation

  • Kiichi Tokuoka, 2017. "Is stock investment contagious among siblings?," Empirical Economics, Springer, vol. 52(4), pages 1505-1528, June.
    • Handle: RePEc:spr:empeco:v:52:y:2017:i:4:d:10.1007_s00181-016-1120-6
    DOI: 10.1007/s00181-016-1120-6
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    More about this item

    Keywords

    Learning; Siblings; Stock investment;
    All these keywords.

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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