- Professor Samuli Knüpfer
- 26. oktober 2017
- Kl. 13.15 – 14.15
- SSB, Akersveien 26, Møterom Utdanning
Professor Samuli Knüpfer
BI Norwegian Business School
Why Does Portfolio Choice Correlate across Generations?
The returns individuals earn on financial wealth correlate positively across generations. We establish this result by analyzing the full population of household investors in Finland. The correlation extends to both historical and expected returns and the intergenerational spread in returns implies sizeable differences in wealth accumulation over time. Asset holdings reveal that returns correlate mostly because family members choose the same securities. An instrument using non-overlapping peer groups and a natural experiment based on mergers allow us to address causality. We find causal influence not only from parents to children but also in the opposite direction. Our findings have implications for understanding wealth inequality and portfolio heterogeneity.
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