Credit Scores, Trust, and Stock Market Participation
Posted: 30 Oct 2015
Date Written: October 1, 2015
Investments in stocks earn a substantially higher return than investment in safer assets in the long run, even after adjusting for risks in the stock market. However, not all households own stocks (Mankiw and Zeldes, 1991), and the share of U.S. households that invest in stocks has been much lower than the standard theory predicts--a phenomenon often referred to as the "participation puzzle."
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