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This paper proposes that the introduction of non-redundant assets can endogenously modify trader participation in financial markets, which can lead to a lower market premium and a higher interest rate. We demonstrate this mechanism in a tractable exchange economy with endogenous participation....
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player role, is drawn to play and chooses a pure strategy according to her personal learning rule after observing a sample … from a finite history. With a small probability individuals also make a mistake and play a pure strategy at random. I prove … that, for a sufficiently low ratio between the sample and history size, only pure-strategy profiles in certain minimal …
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This paper provides a detailed examination of individuals' active participation in a new public and mandatory defined contribution pension system. The new pension system was launched in the fall of 2000 and entitles Sweden's workforce of 4.4 million individuals to invest part of their individual...
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This paper examines how investor and capital flows into mutual funds in the Swedish pension system are related to fund characteristics. Similarly to U.S. studies, we show that individuals chase past returns and have a strong preference for lower-fee funds. However, our results suggest that past...
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This paper studies the relation between fund performance and the fund manager's investment strategy, which is based on …
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