What Does Stock Ownership Breadth Measure?

Using holdings data on a representative sample of all Shanghai Stock Exchange investors, we show that increases in ownership breadth (the fraction of market participants who own a stock) predict low returns: highest change quintile stocks underperform lowest quintile stocks by 23% per year. Small retail investors drive this result. Retail ownership breadth increases appear to be correlated with overpricing. Among institutional investors, however, the opposite holds: Stocks in the top decile of wealth-weighted institutional breadth change outperform the bottom decile by 8% per year, consistent with prior work that interprets breadth as a measure of short-sales constraints.

Social Identity and Preferences

Social identities prescribe behaviors for people. We identify the marginal behavioral effect of these norms on discount rates and risk aversion by measuring how laboratory subjects’ choices change when an aspect of social identity is made salient. When we make ethnic identity salient to Asian-American subjects, they make more patient choices. When we make racial identity salient to black subjects, non-immigrant blacks (but not immigrant blacks) make more patient choices. Making gender identity salient has no effect on intertemporal or risk choices.

Religious Identity and Economic Behavior

We randomly vary religious identity salience in laboratory subjects to test how identity salience contributes to six hypothesized links from prior literature between religious identity and economic behavior. We find that religious identity salience makes Protestants increase contributions to public goods. Catholics decrease contributions to public goods, expect others to contribute less to public goods, and become less risk averse. Jews more strongly reciprocate as an employee in a bilateral labor market gift-exchange game. We find no evidence of religious identity salience effects on disutility of work effort, discount rates, or generosity in a dictator game.

Why Does the Law of One Price Fail? An Experiment on Index Mutual Funds

Experimental subjects allocate $10,000 across four S&P 500 index funds. Subject rewards depend on the chosen portfolio’s subsequent return. Because the investments are not actually intermediated by the fund companies, portfolio returns are unbundled from non-portfolio services. The optimal portfolio therefore invests 100% in the lowest-cost fund. Nonetheless, subjects overwhelmingly fail to minimize fees. When we make fees transparent and salient, portfolios shift towards cheaper funds, but fees are still not minimized. Instead, subjects place high weight on normatively irrelevant historical returns. Subjects who choose high-cost index funds are relatively much less confident about their asset allocation choices.

Mental Accounting in Portfolio Choice: Evidence from a Flypaper Effect

Consistent with mental accounting, we document that investors sometimes choose the asset allocation for one account without considering the asset allocation of their other accounts. The setting is a firm that changed its 401(k) matching rules. Initially, 401(k) enrollees chose the allocation of their own contributions, but the firm chose the match allocation. These enrollees ignored the match allocation when choosing their own-contribution allocation. In the second regime, enrollees simultaneously selected both accounts’ allocations, leading them to mentally integrate the two. Own-contribution allocations before the rule change equal the combined own- and match-contribution allocations afterwards, whereas combined allocations differ sharply across regimes.

$100 Bills on the Sidewalk: Suboptimal Investment in 401(k) Plans

It is typically difficult to determine whether households invest optimally. But sometimes, investment incentives are strong enough to create sharp normative restrictions. We identify employees at seven companies who are eligible to receive employer matching contributions in their 401(k) and can make penalty-free withdrawals for any reason. For these employees, contributing less than the match threshold is a dominated action that violates the no-arbitrage condition. Nevertheless, between 20% and 60% contribute below the threshold, losing as much as 6% of their annual pay. Providing employees with information about the free lunch they are foregoing fails to raise contribution rates.

Effect of Socio-Demographics, Health-Related Problems, and Family Structure on Chronic Absenteeism Among Children

Purpose/Background: From 5 to 7.5 million school children are chronically absent, defined as missing ≥15 days of school within a year. Students miss schools due to various reasons such as health, socioeconomic status, and environmental factors. We examined child’s health and behavior, family structure, and socio-demographics to understand chronic absenteeism. Materials & Methods: The population included children ages 6 to 17 years from the Medical Expenditure Panel Survey (MEPS) years 2008-2013. Multivariable logistic regressions were used to identify the risk factors of chronic absenteeism, adjusting for the complex sampling design. Results: Among socio-demographic variables, age ≥14 years, race/ethnicity, lower-income family, public health insurance, US-born, and speaking English at home were associated with chronic absenteeism. Asians, Mexican Hispanics, and blacks have lower chronic absenteeism than whites. Among health-related variables, children using an inhaler for asthma, having behavioral problems, and less healthy than other children were more likely to be chronically absent. Among family variables, a smaller family size was a risk factor for chronic absenteeism. Discussion/Conclusion: Asthma and behavioral problems were highly associated with chronic absenteeism. The identification of children at risk for chronic absenteeism will help the educational professionals identify the barriers to academic achievements and develop integrated educational interventions and policies to support disadvantaged children