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Social Interaction and Stock Market Participation: Evidence from British Panel Data

Brown, S. and Taylor, K. (2010) Social Interaction and Stock Market Participation: Evidence from British Panel Data. Working Paper. Department of Economics, University of Sheffield ISSN 1749-8368

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Abstract

This paper uses data from the British National Child Development Study to investigate the relationship between social interaction and participation in the stock market through holding stocks and/or shares at the individual level. In accordance with the existing literature, the results reveal that a positive relationship exists between social interaction and stock market participation, when both are measured concurrently. Furthermore, this relationship prevails across a range of measures of social interaction and social capital. In addition, we make a potentially important contribution to the existing literature by exploiting the panel nature of the data in order to explore the robustness of the cross-sectional findings. We find that the positive relationship between stock market participation and social interaction prevails within a fixed effects logit framework, which controls for time invariant unobserved effects.

Item Type: Monograph (Working Paper)
Copyright, Publisher and Additional Information: The Sheffield Economics Research Paper (SERP) series offers a forum for the research output of the academic staff and research students of the Department of Economics, University of Sheffield. Papers are reviewed for quality and presentation by a departmental editor. However, the contents and opinions expressed remain the responsibility of the authors. All papers may be downloaded free on the understanding that the contents are preliminary and therefore permission from the author(s) should be sought before they are referenced.
Keywords: Social Capital; Social Interaction; Stock Market Participation
Academic Units: The University of Sheffield > Faculty of Social Sciences (Sheffield) > Department of Economics (Sheffield) > Sheffield Economics Research Papers Series
Depositing User: Repository Officer
Date Deposited: 29 Apr 2010 10:02
Last Modified: 08 Feb 2013 17:00
Published Version: http://www.shef.ac.uk/economics/research/serps/yea...
Status: Published
Publisher: Department of Economics, University of Sheffield
Identification Number: Sheffield Economic Research Paper Series 2010008
URI: http://eprints.whiterose.ac.uk/id/eprint/10776

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