We investigate the determinants of a household's decision on whether to invest in risky financial assets. Financial … theory suggests that with increasing labor income risk, the reluctance of households to hold stocks increases. We propose to … measure income risk as the observed variation of household income over a five year period. We find that indeed higher income …

.S. household survey, we measure ambiguity aversion using custom- designed questions based on Ellsberg urns. As theory predicts …We test the relation between ambiguity aversion and five household portfolio choice puzzles: non- participation, low …

.S. household survey, we measure ambiguity aversion using custom- designed questions based on Ellsberg urns. As theory predicts …We test the relation between ambiguity aversion and five household portfolio choice puzzles: non- participation, low …