The precise large deviations asymptotics for the sums of independent identical random variables when the distribution of the summand belongs to the class S * S* of heavy tailed distributions is studied. Under mild conditions, we extend the previous results from the paper Denisov et al. (2010) to...

Using a unique FinTech data containing monthly individual-level consumption, investments, and payments, we examine how FinTech can lower investment barriers and improve risk-taking. Seizing on the rapid expansion of offline usages of Alipay in China, we measure individuals' FinTech adoption by...

This paper studies how having your home damaged or destroyed by a natural disaster impacts on economic and financial outcomes. Our context is Australia, where disasters are frequent. Estimates of regression models with individual, area and time fixed-effects, applied to 10 waves of data...

We aim to answer whether retail investors have a stabilizing effect on stock prices during times of financial markets turmoil. To achieve this, we examine the liquidity and crash risk of stocks that are likely held by Robinhood traders (i.e., our proxy for retail investors) using the COVID-19...

We conduct a novel survey of 2,548 nationally representative U.S. respondents to estimate subjective risk-return trade-offs in savings, government bonds, stocks, real estate, gold, and cryptocurrencies. We document a robust negative relationship between respondents’ perceptions of the risk and...

This paper documents a strong relationship between households’ perceptions about inflation over the past 12 months and households’ short- and long-term expectations about future inflation. This relationship is strong during periods of high-inflation but even stronger during low-inflation...

For central banks, it is crucial to develop and maintain risk identification frameworks that allow them to detect in good time and address potential threats to financial stability with the most appropriate policy tools. This paper reviews the main indicators developed for this purpose by the...

We show that incorporating defined benefit pension funds in an asset pricing model with incomplete markets improves its ability to jointly match the historical equity premium and riskless rate, and has important implications for risk sharing. We emphasize the importance of the pension fund's...

Using the relaxation of last-in-first-out (LIFO) seniority rule in Sweden as an exogenous shock to unemployment risks, we show that employees facing increased unemployment risks are more likely to become entrepreneurs. The effect is more pronounced for employees with longer tenure and for male...

We conduct an empirical investigation to examine how income shocks and aggregate conditions influence income expectations, expectation uncertainty and expectation errors. We use data from a large longitudinal Dutch survey collecting detailed information on household income expectations. Our...