Education and the local equity bias around the world

Bose, U., MacDonald, R. and Tsoukas, S. (2015) Education and the local equity bias around the world. Journal of International Financial Markets, Institutions and Money, 39, pp. 65-88. (doi:10.1016/j.intfin.2015.06.002)

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Abstract

Using a panel of 38 economies, over the period 2001 to 2010, we analyse the link between different facets of education and diversification in international portfolios. We find that university education, mathematical numeracy, in addition to financial skill, play an important role in reducing home bias. After separating countries according to their level of financial development, we find that less developed economies with more university graduates, or with higher level of mathematical numeracy, have lower level of local equity bias compared to more developed countries. We also find that the beneficial effect of education is more pronounced during the most recent financial crisis, especially for economies with less developed financial markets.

Item Type:Articles
Status:Published
Refereed:Yes
Glasgow Author(s) Enlighten ID:Tsoukas, Dr Serafeim and MacDonald, Professor Ronald
Authors: Bose, U., MacDonald, R., and Tsoukas, S.
College/School:College of Social Sciences > Adam Smith Business School > Economics
Journal Name:Journal of International Financial Markets, Institutions and Money
Publisher:Elsevier
ISSN:1042-4431
ISSN (Online):1873-0612
Copyright Holders:Copyright © 2015 The Authors
First Published:First published in Journal of International Financial Markets, Institutions and Money 39:65-88
Publisher Policy:Reproduced under a Creative Commons License

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Project CodeAward NoProject NamePrincipal InvestigatorFunder's NameFunder RefLead Dept
591541ESRC Doctoral Training Centre 2011...Mary Beth KneafseyEconomic & Social Research Council (ESRC)ES/J500136/1VICE PRINCIPAL RESEARCH & ENTERPRISE
591542ESRC Doctoral Training Centre 2011...Mary Beth KneafseyEconomic & Social Research Council (ESRC)ES/J500136/1VICE PRINCIPAL RESEARCH & ENTERPRISE
591543ESRC Doctoral Training Centre 2011...Mary Beth KneafseyEconomic & Social Research Council (ESRC)ES/J500136/1VICE PRINCIPAL RESEARCH & ENTERPRISE
591544ESRC Doctoral Training Centre 2011...Mary Beth KneafseyEconomic & Social Research Council (ESRC)ES/J500136/1VICE PRINCIPAL RESEARCH & ENTERPRISE