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Risk management, housing and stockholding

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  • Luc Arrondel
  • Fr餩rique Savignac

Abstract

This article investigates the possible explanations of the stockholding puzzle by focusing on housing and other uninsurable risks (associated with income, health and business). Taking the French household wealth survey (Patrimoine 2004, French National Statistical Institute), we find that the share of financial wealth invested in stocks depends on transaction and information costs, risk aversion, exposure to real estate risk and, to a lesser extent, labour market risk. These results are obtained by controlling for endogenous home ownership status.

Suggested Citation

  • Luc Arrondel & Fr餩rique Savignac, 2015. "Risk management, housing and stockholding," Applied Economics, Taylor & Francis Journals, vol. 47(39), pages 4208-4227, August.
  • Handle: RePEc:taf:applec:v:47:y:2015:i:39:p:4208-4227
    DOI: 10.1080/00036846.2015.1026585
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