This paper investigates the importance that market regulation and financial imperfections have in firm size. We analyse institutions affecting labour market as Employment Protection Laws (EPL) and Product Market Regulation (PMR). Moreover, we study the effects of these institutions on firm...

This paper provides a joint analysis of household stockholding participation, stock location among stockholding modes, and participation spillovers, using data from the US Survey of Consumer Finances. Our multivariate choice model matches observed participation rates, conditional and...

Using life-history survey data from eleven European countries, we investigate whether childhood conditions, such as socioeconomic status, cognitive abilities and health problems influence portfolio choice and risk attitudes later in life. After controlling for the corresponding conditions in...

The paper studies the determinants of international differences in household indebtedness, and inquires whether indebtedness is associated with increased “financial fragility”, as measured by the sensitivity of household arrears and insolvencies to macroeconomic shocks. It also investigates...

How does the punishment for default affect repayment behavior? We use administrative data provided by the leading Italian lender of unsecured credit to the household sector to investigate the effect of two potentially important factors: judicial efficiency and the availability of informal credit...

In developing countries, traditional social obligations often press rich individuals to share their income. In this paper, we posit a "model of social pressure" in which people can sign binding financial agreements amongst themselves, thereby forming coalitions. These financial agreements may...

We investigate, using the 2002 US Health and Retirement Study, the factors influencing individuals’ insecurity and expectations about terrorism, and study the effects these last have on households’ portfolio choices and spending patterns. We find that females, the religiously devout, those...

Using data from the US Health and Retirement Study, we study the causal effect of increased health insurance coverage through Medicare and the associated reduction in health-related background risk on financial risk-taking. Given the onset of Medicare at age 65, we identify our effect of...

Speculators often advertise arbitrage opportunities in order to persuade other investors and thus accelerate the correction of mispricing. This induces under-diversification: a risk-averse arbitrageur will optimally advertise only one of several mispriced assets, and overweigh it in his...

The underpricing of the shares sold through Initial Public Offerings (IPOs) is generally explained with asymmetric information and risk. We complement these traditional explanations with a new theory. Investors who buy IPO shares are also concerned by expected liquidity and by the uncertainty...