Scandinavian Working Papers in Economics

SSE/EFI Working Paper Series in Economics and Finance,
Stockholm School of Economics

No 737: Gender, Stock Market Participation and Financial Literacy

Johan Almenberg () and Anna Dreber ()
Additional contact information
Johan Almenberg: Ministry of Finance, Sweden, Postal: Ministry of Finance, Drottninggatan 21, 103 33 Stockholm, Sweden
Anna Dreber: Dept. of Economics, Stockholm School of Economics, Postal: Stockholm School of Economics, P.O. Box 6501, SE-113 83 Stockholm, Sweden

Abstract: omen typically participate less than men in the stock market, while also scoring lower on financial literacy. We explore the link between the gender gap in stock market participation and financial literacy. Using survey data on a random sample of 1,300 individuals that is representative of the Swedish population, we show that controlling for basic financial literacy, essentially a measure of numeracy that does not require knowledge about the stock market, may explain a large part of the gender gap in stock market participation. We also find that women report being less risk taking than men. This gender gap in risk attitudes remains significant also when controlling for financial literacy.

Keywords: stock market participation; gender; financial literacy; numeracy; risk attitudes

JEL-codes: D14; G11

17 pages, First version: August 10, 2011. Revised: June 18, 2012. Earlier revisions: August 16, 2011, June 18, 2012.

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