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Students’ perceived risk and investment intention: the effect of brand equity


  • Washington Macías


  • Shirley Espinoza
  • Lisset Gutiérrez
  • Regina Rodríguez

    (Escuela Superior Politécnica del Litoral, ESPOL, Facultad de Ciencias Sociales y Humanísticas, Ecuador)


Emerging markets bring out the question of motivation to include of new investors in the market for financial securities often arises. The purpose of this study is to analyze how brands influence the investment intention of young potential investors. Specifically, the relationship between consumer based brand equity - according to Aaker’s multidimensional conceptualization - and investment intention, mediated by perceived risk, is analyzed. The study contributes to the literature in two ways: (1) based on the revision made, no study has analyzed Aaker’s brand equity construct in investment decisions; (2) studies linking brand aspects to investment decisions have not examined the mediating role of perceived risk. Through an experiment, where perceived risk and investment intention in a famous brand were measured as differences from fictitious brands, the following results were found: (1) the investment intention in a famous brand is higher than in a non-famous one, once controlled for risk and return; (2) the higher the brand equity, the lesser the perceived risk of investing in the famous brand, and the higher the investment intention; (3) the perceived quality of a brand’s products was the dimension by which the effect of brand equity is transmitted. Involvement with the investment task and cognitive ability, at an individual level, the relative size of comparable firms, and the risk and return of investment alternatives were introduced as control variables.

Suggested Citation

  • Washington Macías & Shirley Espinoza & Lisset Gutiérrez & Regina Rodríguez, 2015. "Students’ perceived risk and investment intention: the effect of brand equity," Management & Marketing, Sciendo, vol. 10(3), pages 208-225, October.
  • Handle: RePEc:vrs:manmar:v:10:y:2015:i:3:p:208-225:n:3

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    References listed on IDEAS

    1. Annamaria Lusardi & Olivia S. Mitchell & Vilsa Curto, 2009. "Financial Literacy among the Young: Evidence and Implications for Consumer Policy," NBER Working Papers 15352, National Bureau of Economic Research, Inc.
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    3. Kevin Lane Keller & Donald R. Lehmann, 2006. "Brands and Branding: Research Findings and Future Priorities," Marketing Science, INFORMS, vol. 25(6), pages 740-759, 11-12.
    4. Herbert A. Simon, 1955. "A Behavioral Model of Rational Choice," The Quarterly Journal of Economics, Oxford University Press, vol. 69(1), pages 99-118.
    5. Alexander Klos & Elke U. Weber & Martin Weber, 2005. "Investment Decisions and Time Horizon: Risk Perception and Risk Behavior in Repeated Gambles," Management Science, INFORMS, vol. 51(12), pages 1777-1790, December.
    6. Netemeyer, Richard G. & Krishnan, Balaji & Pullig, Chris & Wang, Guangping & Yagci, Mehmet & Dean, Dwane & Ricks, Joe & Wirth, Ferdinand, 2004. "Developing and validating measures of facets of customer-based brand equity," Journal of Business Research, Elsevier, vol. 57(2), pages 209-224, February.
    7. George A. Akerlof, 1970. "The Market for "Lemons": Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, Oxford University Press, vol. 84(3), pages 488-500.
    8. Elke U. Weber & Christopher Hsee, 1998. "Cross-Cultural Differences in Risk Perception, but Cross-Cultural Similarities in Attitudes Towards Perceived Risk," Management Science, INFORMS, vol. 44(9), pages 1205-1217, September.
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