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Knowing is trusting? An experimental test of the role of information in advisory

Author

Listed:
  • Caterina Cruciani

    () (Dept. of Management and Economics, University of Padua)

  • Gloria Gardenal

    () (Dept. of Management, Università Ca' Foscari Venice)

  • Anna Moretti

    () (Dept. of Management, Università Ca' Foscari Venice)

Abstract

The recent economic crisis still lingering in Europe has deeply affected the way individuals look at the investment market. Understanding the trust processes underlying the decision to invest with financial intermediaries is of particular importance both at managerial (product development and advertisement) and at normative level (how intermediaries are regulated). Using an online experiment, this paper investigates whether discrepancies in the financial literacy of investors and brokers can be used to explain the decision to trust, thus, to invest in the financial market. The results show that trust is affected by the information disclosure in somewhat unexpected ways.

Suggested Citation

  • Caterina Cruciani & Gloria Gardenal & Anna Moretti, 2015. "Knowing is trusting? An experimental test of the role of information in advisory," Working Papers 2, Department of Management, Università Ca' Foscari Venezia.
  • Handle: RePEc:vnm:wpdman:103
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    More about this item

    Keywords

    financial market; financial literacy; trust; advisory;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions

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