We document that prior portfolio choices influence investors' expectations about asset values, and their future choices. We find that people update more from information consistent with their prior choices, leading to sticky portfolios over time. These effects are related to how the brain's...

Borrowing decisions affect most households, with large stakes and implications for subfields as varied as macroeconomics and industrial organization. I review theoretical and empirical work on household debt: its prevalence, level, growth, and composition, as well as various measures of consumer...

Redress to consumers following the mis-selling of financial products is an important regulatory tool to secure an appropriate degree of protection for consumers, one of the three operational objectives of the Financial Conduct Authority (FCA). In 2011/12, excluding compensation for payment...

Financial innovations have resulted in an explosion in the number of so-called structured products being offered in the retail marketplace. To explain the complex structure of these hybrid debt securities, their prospectuses frequently employ numerical examples to illustrate the investment's...

In this paper, we disentangle investor sentiment into two components: mood and household attitudes towards the economy. We apply acoustical analysis to the daily top ten of music downloads in iTunes for Germany to derive a novel and direct measure for mood. We match this novel mood index with...

Financial literacy is the knowledge and skills required to manage one's financial resources effectively. Financial literacy is more important than ever in today’s fast-paced world, especially for the younger generation. The younger generation in India is a crucial demographic group that is...

We combine the Critical Cost Efficiency Index and the Houtman Maks Index to evaluate the consistency of subjects in a set of choice data from budgets. We show that by simply allowing subjects for one significant mistake (by removing the worst observation), the mean Critical Cost Efficiency Index...

Exploiting the natural experiment of the German reunification, we examine how consumers adapt to a new environment in their macroeconomic forecasting. We document that East Germans expect higher inflation and make larger forecast errors than West Germans even decades after reunification....

Exploiting the natural experiment of the German reunification, we examine how consumers adapt to a new environment in their macroeconomic forecasting. We document that East Germans expect higher inflation and make larger forecast errors than West Germans even decades after reunification....