Gender Differences in Risk Tolerance

In this chapter, the author examines the influence of gender on financial risk tolerance. The risk tolerance is assessed by the instrument developed by Grable and Lytton in a sample that includes 272 postgraduate students of the University of Porto (Portugal). The results show that males are significantly more risk-tolerant than females, even after controlling for factors such as the economic status and educational levels of the respondents' parents. The gender differences seem to be essentially driven by a higher proportion of males with high levels of risk tolerance. Moreover, belonging to a household with a high level of annual income contributes to increase the likelihood of exhibiting high levels of risk tolerance. In the total sample, the levels of risk tolerance are lower than those reported in similar studies. Overall, the author documents that there are significant gender differences in financial risk perception. </jats:p

Do ideal ao material: uma anatomia sócio-comportamental de um leilão holandês em Portugal

Neste artigo levamos a cabo um estudo etnográfico de um leilão de pescado que tem lugar em Matosinhos (Portugal). A observação in situ do funcionamento do mercado aponta para a existência de uma comunidade de participantes coesa, marcada pela informalidade e pela aceitação tácita das regras constitutivas do leilão. As condições materiais de criação do mercado (organização do espaço, ecrãs, comandos de transmissão de ordens) revelam-se centrais no fortalecimento e na atenuação de dinâmicas de observação recíproca e de competição entre os agentes. Entendidas no seu conjunto, as contribuições deste artigo evidenciam a importância de se considerar as condições substanciais de criação de um mercado, por oposição a uma abordagem metodológica meramente formal.In this paper we carry out an ethnographic study at a fish auction that takes place in Matosinhos (Portugal). The in-situ observation of the functioning of the market suggests the existence of a cohesive community of participants, marked by informality and by the tacit acceptance of the constitutive rules of the auction. The material conditions of market creation (organization of the space, screens, remote control to transmit market orders) are central to the strengthening and weakening of the dynamics of mutual observation and competition among market participants. Taken together, the contributions of this paper highlight the importance of considering the substantive conditions of market creation, as opposed to a purely formal methodological approach.Dans cet article, nous menons une étude ethnographique lors d’une vente aux enchères de poisson à Matosinhos (Portugal). L’observation in situ du fonctionnement du marché suggère l’existence d’une communauté de participants cohésive, marquée par l’informalité et l’acceptation tacite des règles de comportement de la vente aux enchères. Les conditions matérielles de la création du marché (organisation de l’espace, écrans, télécommande pour transmettre les ordres) sont essentielles pour renforcer et atténuer les dynamiques d’observation mutuelle et de concurrence entre agents. Prises ensemble, les contributions de cet article soulignent l’importance de considérer les conditions substantielles de la création du marché, par opposition à une approche méthodologique purement formelle.En este artículo se realiza un estudio etnográfico a una subasta de pescado que tiene lugar en Matosinhos (Portugal). La observación in-situ del funcionamiento del mercado apunta a la existencia de una comunidad de participantes cohesiva, marcada por la informalidad y la aceptación tácita de las reglas constitutivas de la subasta. Las condiciones materiales de creación del mercado (organización del espacio, pantallas, comandos de transmisión de órdenes) se revelan centrales en el fortalecimiento y la atenuación de dinámicas de observación recíproca y de competencia entre los agentes. Entendidas en su conjunto, las contribuciones de este artículo ponen de manifiesto la importancia de considerar las condiciones sustanciales de creación de un mercado, en oposición a un enfoque metodológico meramente formal

Behavioural Corporate Finance

Orthodox financial theory often ignores the role played by managers' personal characteristics in their decision-making processes. However, as anyone with experience in the business world knows, managers' personalities are crucial in the choices they make. Indeed, it should be noted that firms do not make decisions, rather it is the managers who decide - either as a group or individually.This book explores the impact of managers' psychological profiles and life experiences on their financial decisions, taking the following key questions as starting points: Why do they commit mistakes? Why do they contract debt and issue shares? How do they choose the right amount of dividends to distribute? Why do they acquire other firms? Why do they sometimes choose to manipulate information and to commit fraud?As the book highlights, having insights into managers' psychology is essential to understanding their choices and predicting decisions made by competing firms

Do National Cultures Impact Mortgage and Financial Well-Being Levels? Evidence from Europe

This study explores the influence of national culture on mortgage and financial well-being levels in the European context. The paper employs regression analysis using mainly Hofstede's cultural dimensions and the EU-SILC dataset from Eurostat to provide a better understanding of the determinants of the decision to hold secured debts and a better explanation of the states of financial well-being. To the best of our knowledge, no study has addressed the influence of culture on mortgage and financial well-being levels in the European setting using samples from different countries and controlling for household characteristics. We conclude that power distance, masculinity, uncertainty avoidance, and long-term orientation are negatively associated with the likelihood of holding a mortgage. The results also show that masculinity, uncertainty avoidance, long-term orientation, and indulgence are negatively associated with the amount of mortgage. Moreover, individualism and long-term orientation (power distance and uncertainty avoidance) are positively (negatively) associated with being in a state of financial well-being. Collectively, our research shows that national cultures play a crucial role in household finance.JEL Codes - D10; G40; G5

What to Do in Financial Markets? Preferences and Incoherences of Future Investors

The beliefs and strategies to be mobilized by individuals who are about to start their activity as investors in financial markets is an issue scarcely explored in the field of the sociology of finance. In this paper we present new evidence about the opinions of future investors recurring to a survey administered to 177 master’s students. Our results highlight the structural incoherence in the values adopted by future investors and the centrality of these social actors’ beliefs in the construction of the prevailing practices in financial markets

Beliefs and perceptions of future investors: A contribution to social studies in finance = Crenças e percepções dos futuros investidores: Um contributo para os Estudos Sociais em Finanças

As crenças e percepções dos indivíduos que estão prestes a iniciar a sua actividade de investimento nos mercados financeiros têm sido uma matéria pouco explorada pela Sociologia das Finanças. Neste artigo apresentamos nova evidência acerca das opiniões dos futuros investidores, recorrendo a um questionário distribuído a um grupo de 177 estudantes universitários entre os anos 2014 e 2016. Os resultados obtidos sugerem que os indivíduos têm percepções inconsistentes acerca dos mercados financeiros, evidenciando-se igualmente um conflito entre a necessidade abstracta de regulação e as consequências subjectivas decorrentes da aplicação das práticas regulatórias.In the field of the Sociology of Finance, the beliefs and perceptions of individuals about to begin investing in financial markets has not been an issue thoroughly explored in the literature. In this article, we present new evidence about the opinions of future investors taken from a survey of 177 university students from 2014-2016. The results suggest that individuals have inconsistent perceptions about the financial markets; in addition, there is conflict between the abstract need for regulation and the subjective consequences arising from the application of regulatory practices.Les croyances et les perceptions des individus qui sont sur le point de démarrer leur activité d’investissement sur les marchés financiers sont un sujet peu exploré par la Sociologie de la Finance. Dans cet article, nous présentons de nouvelles preuves sur les opinions des futurs investisseurs, en ayant recours à un questionnaire distribué à un groupe de 177 étudiants universitaires entre 2014 et 2016. Les résultats obtenus suggèrent que les individus ont des perceptions inconsistantes sur les marchés financiers, mettant aussi en lumière un conflit entre le besoin abstrait de réglementation et les conséquences subjectives qui découlent de l’application de pratiques réglementaires