For our report Mapping Maastricht, we have used CBS Microdata in order to map the development of ... more For our report Mapping Maastricht, we have used CBS Microdata in order to map the development of number of companies, FTEs, entrepreneurs and entrepreneurial profit in the sector. We depict the situation in Maastricht and compare it to the Netherlands as a whole, the urbanised areas of the Netherlands (Randstad), cities comparible to Maastricht such as Eindhoven or Arnhem, and to the rest of South-Limburg.
People interested in the research are advised to contact the author for the final version of the ... more People interested in the research are advised to contact the author for the final version of the publication, or visit the DOI to the publisher's website. • The final author version and the galley proof are versions of the publication after peer review. • The final published version features the final layout of the paper including the volume, issue and page numbers. Link to publication General rights Copyright and moral rights for the publications made accessible in the public portal are retained by the authors and/or other copyright owners and it is a condition of accessing publications that users recognise and abide by the legal requirements associated with these rights. • Users may download and print one copy of any publication from the public portal for the purpose of private study or research. • You may not further distribute the material or use it for any profit-making activity or commercial gain • You may freely distribute the URL identifying the publication in the public portal. If the publication is distributed under the terms of Article 25fa of the Dutch Copyright Act, indicated by the "Taverne" license above, please follow below link for the End User Agreement:
Using a unique historical data set, we show the value of expertise and reputation during the evol... more Using a unique historical data set, we show the value of expertise and reputation during the evolution of the art market. First, we illustrate how market dynamics encourage the entry of dealers with heterogeneous characteristics. Second, our results provide evidence that relatively larger dealers pay about 21% more for an artwork of the same quality than smaller dealers as a result of their accumulated experience and reputation. Third, our results indicate that larger dealers are more likely to survive in the market. Our evidence outlines the importance of the accumulation of market power in an emerging market characterized by uncertainty and heterogeneity. These results have important implications for maintaining and sustaining competitive advantage
Deviations from normality in financial return series have led to the development of alternative p... more Deviations from normality in financial return series have led to the development of alternative portfolio selection models. One such model is the downside risk model, whereby the investor maximizes his return given a downside risk constraint. In this paper we empirically observe the international equity allocation for the downside risk investor using 9 international markets' returns over the last 34 years. The results are stable for various robustness checks. Investors may think globally, but instead act locally, due to greater downside risk. The results provide an alternative view of the home bias phenomenon, documented in international financial markets.
To date little attention has been paid to how social cognitive bias can influence how financial a... more To date little attention has been paid to how social cognitive bias can influence how financial advisors interpret and respond to the needs of millionaire investors, and if this varies depending on the gender of the investor. This research investigates whether experienced professional financial advisors who work with millionaire investors make different attributions for the control and knowledge that investors have of their investments, and if they make different investment portfolio recommendations to equivalent male and female investors. Using methodology novel to finance, this vignette-based study that controls for gender finds evidence that professional financial advisors judge millionaire female investors to have less control over their investment portfolios relative to men. Empirical results also show that female advisors judge women to be less knowledgeable about investments than men. Despite such perceptual differences, advisors recommend equally risky portfolios to male and female investors. These results have implications for wealth management institutions and the monitoring of financial advisors for millionaire individuals.
In this paper we investigate the importance of acquaintance networks for financial decisions by h... more In this paper we investigate the importance of acquaintance networks for financial decisions by households. We construct a variable capturing the expected proximity or social closeness to a subpopulation of financially savvy people using an overdispersed Poisson model. This measure captures the exposure to people with financial knowledge in an investor's acquaintance network. We find that investors with a higher exposure to financial savvy people are more likely to invest in stocks. This holds after controlling for a wide range of known stock market participation determinants. Moreover when restricting to households with elevated levels of trust or wealth the impact of exposure to financial savvy people increases. Our main findings continue to hold in several analyses to uncover an exogenous effect from proximity on stock market participation. Furthermore we show that the importance of acquaintance networks extends to other financial decisions as well.
Sustainable development entails meeting our present needs without compromising the ability of fut... more Sustainable development entails meeting our present needs without compromising the ability of future generations to meet their needs. This requires us to treat economic, social and environmental aspects in an integrated way, but little is known about the nature of individual preferences towards the trade-o¤s involved in this e¤ort. For the …rst time, we study individual preferences towards the environment, social wellbeing, and …nancial wellbeing using a survey of over 1400 households in the Netherlands. Using nonparametric, parametric, and matching methods, we …nd that gender and education are important factors for sustainability rather than income levels. Moreover results indicate that educated females put the greatest value on going green whilst being socially minded.
Journal of Behavioral and Experimental Finance, 2014
ABSTRACT Institutional investors invest billions of dollars on behalf of investors whilst knowing... more ABSTRACT Institutional investors invest billions of dollars on behalf of investors whilst knowing little about investors’ social preferences. Using survey data from a customized wave of the Dutch CentERdata panel for citizens who are obliged to participate in a pension plan, we find significant variation in attitudes towards proposed social investment screens. Although individuals are able to express their attitudes towards social investment criteria they have difficultiesmaking financial decisions while simultaneously taking their non-financial preferences into account. This is partially driven by the low financial sophistication of households. To emphasize the importance of these findings we show that the majority of beneficiaries derive positive utility from environmental and social pension investment screens and that expressing a positive attitude towards screened pension investments is the most important driver of this effect.
We find evidence for the behavioral biases of anchoring and loss aversion. We find that anchoring... more We find evidence for the behavioral biases of anchoring and loss aversion. We find that anchoring is more important for items that are resold quickly, and we find that the effect of loss aversion increases with the time that a painting is held. The evidence in favor of anchoring and loss aversion with a large new dataset validates previous results and adds to the empirical evidence a finding of increasing loss aversion with the length of holding. However, we do not find evidence that investors can take advantage of these behavioral biases. 2
We find evidence for the behavioral biases of anchoring and loss aversion. We find that anchoring... more We find evidence for the behavioral biases of anchoring and loss aversion. We find that anchoring is more important for items that are resold quickly, and we find that the effect of loss aversion in-creases with the time that a painting is held. The evidence in favor of anchoring and loss aversion with this large dataset validates previ-ous results and adds to the empirical evidence a finding of increasing loss aversion with the length a painting is held. We do not find evi-dence that investors can take advantage of these behavioral biases.
Benefits to portfolio diversification depend crucially on correct correlation estimates, hence it... more Benefits to portfolio diversification depend crucially on correct correlation estimates, hence it is of great importance to both risk management and portfolio optimisation that the exact nature of the correlation structure between international financial assets is understood. Recent discussion on the correlation of international equity returns has focussed on the issue of whether extreme movements in international financial markets are more highly correlated than usual returns. This implies a reduction in the benefits from portfolio diversification since extreme returns are more likely to occur with greater simultaneity. Using the Value-at-Risk methodology we are able to measure the quantile correlation structure implicit in international asset returns in a simple manner without having to resort to fully parametric modelling. We illustrate that the extraction of the quantile covariance structure from this quantile correlation structure is non-trivial. Using daily data on stock marke...
People interested in the research are advised to contact the author for the final version of the ... more People interested in the research are advised to contact the author for the final version of the publication, or visit the DOI to the publisher's website. • The final author version and the galley proof are versions of the publication after peer review. • The final published version features the final layout of the paper including the volume, issue and page numbers. Link to publication General rights Copyright and moral rights for the publications made accessible in the public portal are retained by the authors and/or other copyright owners and it is a condition of accessing publications that users recognise and abide by the legal requirements associated with these rights. • Users may download and print one copy of any publication from the public portal for the purpose of private study or research. • You may not further distribute the material or use it for any profit-making activity or commercial gain • You may freely distribute the URL identifying the publication in the public portal. If the publication is distributed under the terms of Article 25fa of the Dutch Copyright Act, indicated by the "Taverne" license above, please follow below link for the End User Agreement:
This study aims to identify factors contributing to price fluctuations in artworks after an artis... more This study aims to identify factors contributing to price fluctuations in artworks after an artist’s death. With access to information on seller characteristics from a historical dataset of all art auctions that took place in London between 1741 and 1913, we investigate how trading patterns and network effects at auctions affect art sales prices. Following an artist’s death, we capture dynamic effects in sales patterns and find that prices decline by 7%. We attribute this decline on the confluence of non-strategic and strategic effects, first on a frequent lack of access to professional consultation and secondly on changes in trading patterns of art dealers posthumously. Our results highlight the long-term influence of those factors on high valued art.
We find evidence for the behavioral biases of anchoring and loss aversion. We find that anchoring... more We find evidence for the behavioral biases of anchoring and loss aversion. We find that anchoring is more important for items that are resold quickly, and we find that the effect of loss aversion increases with the time that a painting is held. The evidence in favor of anchoring and loss aversion with this large dataset validates previous results and adds to the empirical evidence a finding of increasing loss aversion with the length a painting is held. We do not find evidence that investors can take advantage of these behavioral biases.
Users may download and print one copy of any publication from the public portal for the purpose o... more Users may download and print one copy of any publication from the public portal for the purpose of private study or research You may not further distribute the material or use it for any profit-making activity or commercial gain You may freely distribute the URL identifying the publication in the public portal Take down policy If you believe that this document breaches copyright, please contact us providing details, and we will remove access to the work immediately and investigate your claim.
Using a unique and large survey on Dutch households we nd robust evidence that people whose incom... more Using a unique and large survey on Dutch households we nd robust evidence that people whose income is short of their aspired income are more risk-tolerant and more loss-tolerant than people whose income exceeds their aspirations, after controlling for a number of socio-economic characteristics. Our results provide support for risk-taking being dependent on shifts in reference points, based on aspired income rather than current levels of income. Furthermore, we nd that competitive people are more tolerant to risk and that those who strive for status are less averse to loses. We also nd greater support for the moving-ahead-of-the
For our report Mapping Maastricht, we have used CBS Microdata in order to map the development of ... more For our report Mapping Maastricht, we have used CBS Microdata in order to map the development of number of companies, FTEs, entrepreneurs and entrepreneurial profit in the sector. We depict the situation in Maastricht and compare it to the Netherlands as a whole, the urbanised areas of the Netherlands (Randstad), cities comparible to Maastricht such as Eindhoven or Arnhem, and to the rest of South-Limburg.
People interested in the research are advised to contact the author for the final version of the ... more People interested in the research are advised to contact the author for the final version of the publication, or visit the DOI to the publisher's website. • The final author version and the galley proof are versions of the publication after peer review. • The final published version features the final layout of the paper including the volume, issue and page numbers. Link to publication General rights Copyright and moral rights for the publications made accessible in the public portal are retained by the authors and/or other copyright owners and it is a condition of accessing publications that users recognise and abide by the legal requirements associated with these rights. • Users may download and print one copy of any publication from the public portal for the purpose of private study or research. • You may not further distribute the material or use it for any profit-making activity or commercial gain • You may freely distribute the URL identifying the publication in the public portal. If the publication is distributed under the terms of Article 25fa of the Dutch Copyright Act, indicated by the "Taverne" license above, please follow below link for the End User Agreement:
Using a unique historical data set, we show the value of expertise and reputation during the evol... more Using a unique historical data set, we show the value of expertise and reputation during the evolution of the art market. First, we illustrate how market dynamics encourage the entry of dealers with heterogeneous characteristics. Second, our results provide evidence that relatively larger dealers pay about 21% more for an artwork of the same quality than smaller dealers as a result of their accumulated experience and reputation. Third, our results indicate that larger dealers are more likely to survive in the market. Our evidence outlines the importance of the accumulation of market power in an emerging market characterized by uncertainty and heterogeneity. These results have important implications for maintaining and sustaining competitive advantage
Deviations from normality in financial return series have led to the development of alternative p... more Deviations from normality in financial return series have led to the development of alternative portfolio selection models. One such model is the downside risk model, whereby the investor maximizes his return given a downside risk constraint. In this paper we empirically observe the international equity allocation for the downside risk investor using 9 international markets' returns over the last 34 years. The results are stable for various robustness checks. Investors may think globally, but instead act locally, due to greater downside risk. The results provide an alternative view of the home bias phenomenon, documented in international financial markets.
To date little attention has been paid to how social cognitive bias can influence how financial a... more To date little attention has been paid to how social cognitive bias can influence how financial advisors interpret and respond to the needs of millionaire investors, and if this varies depending on the gender of the investor. This research investigates whether experienced professional financial advisors who work with millionaire investors make different attributions for the control and knowledge that investors have of their investments, and if they make different investment portfolio recommendations to equivalent male and female investors. Using methodology novel to finance, this vignette-based study that controls for gender finds evidence that professional financial advisors judge millionaire female investors to have less control over their investment portfolios relative to men. Empirical results also show that female advisors judge women to be less knowledgeable about investments than men. Despite such perceptual differences, advisors recommend equally risky portfolios to male and female investors. These results have implications for wealth management institutions and the monitoring of financial advisors for millionaire individuals.
In this paper we investigate the importance of acquaintance networks for financial decisions by h... more In this paper we investigate the importance of acquaintance networks for financial decisions by households. We construct a variable capturing the expected proximity or social closeness to a subpopulation of financially savvy people using an overdispersed Poisson model. This measure captures the exposure to people with financial knowledge in an investor's acquaintance network. We find that investors with a higher exposure to financial savvy people are more likely to invest in stocks. This holds after controlling for a wide range of known stock market participation determinants. Moreover when restricting to households with elevated levels of trust or wealth the impact of exposure to financial savvy people increases. Our main findings continue to hold in several analyses to uncover an exogenous effect from proximity on stock market participation. Furthermore we show that the importance of acquaintance networks extends to other financial decisions as well.
Sustainable development entails meeting our present needs without compromising the ability of fut... more Sustainable development entails meeting our present needs without compromising the ability of future generations to meet their needs. This requires us to treat economic, social and environmental aspects in an integrated way, but little is known about the nature of individual preferences towards the trade-o¤s involved in this e¤ort. For the …rst time, we study individual preferences towards the environment, social wellbeing, and …nancial wellbeing using a survey of over 1400 households in the Netherlands. Using nonparametric, parametric, and matching methods, we …nd that gender and education are important factors for sustainability rather than income levels. Moreover results indicate that educated females put the greatest value on going green whilst being socially minded.
Journal of Behavioral and Experimental Finance, 2014
ABSTRACT Institutional investors invest billions of dollars on behalf of investors whilst knowing... more ABSTRACT Institutional investors invest billions of dollars on behalf of investors whilst knowing little about investors’ social preferences. Using survey data from a customized wave of the Dutch CentERdata panel for citizens who are obliged to participate in a pension plan, we find significant variation in attitudes towards proposed social investment screens. Although individuals are able to express their attitudes towards social investment criteria they have difficultiesmaking financial decisions while simultaneously taking their non-financial preferences into account. This is partially driven by the low financial sophistication of households. To emphasize the importance of these findings we show that the majority of beneficiaries derive positive utility from environmental and social pension investment screens and that expressing a positive attitude towards screened pension investments is the most important driver of this effect.
We find evidence for the behavioral biases of anchoring and loss aversion. We find that anchoring... more We find evidence for the behavioral biases of anchoring and loss aversion. We find that anchoring is more important for items that are resold quickly, and we find that the effect of loss aversion increases with the time that a painting is held. The evidence in favor of anchoring and loss aversion with a large new dataset validates previous results and adds to the empirical evidence a finding of increasing loss aversion with the length of holding. However, we do not find evidence that investors can take advantage of these behavioral biases. 2
We find evidence for the behavioral biases of anchoring and loss aversion. We find that anchoring... more We find evidence for the behavioral biases of anchoring and loss aversion. We find that anchoring is more important for items that are resold quickly, and we find that the effect of loss aversion in-creases with the time that a painting is held. The evidence in favor of anchoring and loss aversion with this large dataset validates previ-ous results and adds to the empirical evidence a finding of increasing loss aversion with the length a painting is held. We do not find evi-dence that investors can take advantage of these behavioral biases.
Benefits to portfolio diversification depend crucially on correct correlation estimates, hence it... more Benefits to portfolio diversification depend crucially on correct correlation estimates, hence it is of great importance to both risk management and portfolio optimisation that the exact nature of the correlation structure between international financial assets is understood. Recent discussion on the correlation of international equity returns has focussed on the issue of whether extreme movements in international financial markets are more highly correlated than usual returns. This implies a reduction in the benefits from portfolio diversification since extreme returns are more likely to occur with greater simultaneity. Using the Value-at-Risk methodology we are able to measure the quantile correlation structure implicit in international asset returns in a simple manner without having to resort to fully parametric modelling. We illustrate that the extraction of the quantile covariance structure from this quantile correlation structure is non-trivial. Using daily data on stock marke...
People interested in the research are advised to contact the author for the final version of the ... more People interested in the research are advised to contact the author for the final version of the publication, or visit the DOI to the publisher's website. • The final author version and the galley proof are versions of the publication after peer review. • The final published version features the final layout of the paper including the volume, issue and page numbers. Link to publication General rights Copyright and moral rights for the publications made accessible in the public portal are retained by the authors and/or other copyright owners and it is a condition of accessing publications that users recognise and abide by the legal requirements associated with these rights. • Users may download and print one copy of any publication from the public portal for the purpose of private study or research. • You may not further distribute the material or use it for any profit-making activity or commercial gain • You may freely distribute the URL identifying the publication in the public portal. If the publication is distributed under the terms of Article 25fa of the Dutch Copyright Act, indicated by the "Taverne" license above, please follow below link for the End User Agreement:
This study aims to identify factors contributing to price fluctuations in artworks after an artis... more This study aims to identify factors contributing to price fluctuations in artworks after an artist’s death. With access to information on seller characteristics from a historical dataset of all art auctions that took place in London between 1741 and 1913, we investigate how trading patterns and network effects at auctions affect art sales prices. Following an artist’s death, we capture dynamic effects in sales patterns and find that prices decline by 7%. We attribute this decline on the confluence of non-strategic and strategic effects, first on a frequent lack of access to professional consultation and secondly on changes in trading patterns of art dealers posthumously. Our results highlight the long-term influence of those factors on high valued art.
We find evidence for the behavioral biases of anchoring and loss aversion. We find that anchoring... more We find evidence for the behavioral biases of anchoring and loss aversion. We find that anchoring is more important for items that are resold quickly, and we find that the effect of loss aversion increases with the time that a painting is held. The evidence in favor of anchoring and loss aversion with this large dataset validates previous results and adds to the empirical evidence a finding of increasing loss aversion with the length a painting is held. We do not find evidence that investors can take advantage of these behavioral biases.
Users may download and print one copy of any publication from the public portal for the purpose o... more Users may download and print one copy of any publication from the public portal for the purpose of private study or research You may not further distribute the material or use it for any profit-making activity or commercial gain You may freely distribute the URL identifying the publication in the public portal Take down policy If you believe that this document breaches copyright, please contact us providing details, and we will remove access to the work immediately and investigate your claim.
Using a unique and large survey on Dutch households we nd robust evidence that people whose incom... more Using a unique and large survey on Dutch households we nd robust evidence that people whose income is short of their aspired income are more risk-tolerant and more loss-tolerant than people whose income exceeds their aspirations, after controlling for a number of socio-economic characteristics. Our results provide support for risk-taking being dependent on shifts in reference points, based on aspired income rather than current levels of income. Furthermore, we nd that competitive people are more tolerant to risk and that those who strive for status are less averse to loses. We also nd greater support for the moving-ahead-of-the
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