Background and aims Personal investors decrease their stock market investment returns by trading frequently, which the behavioral finance literature has primarily explained via investors' overconfidence and low levels of financial literacy. This study investigates whether problem gambling can help account for frequent trading in a sample of active gambler/investors, as suggestive of frequent trading being in part driven by a behavioral addiction to gambling-like activities. Methods A retrospective cross-sectional study of 795 US-based participants, who reported both being active gamblers and holding stock market investments. Recollected stock trading activity (typical portfolio size, purchases and sales of stocks) was compared with scores on the Problem Gambling Severity Index, a financial literacy scale, and a measure of overconfidence. Results Self-reported relative stock portfolio turnover was positively associated with problem gambling scores. This association was robust to controls for financial literacy, overconfidence, and demographics, and occurred equally among investors of all self-reported portfolio sizes. Discussion and conclusions This study provides support for the hypothesis that behavioral addiction to gambling-like activities is associated with frequent stock market trading. New investment products that increase the ease of trading may therefore be detrimental to some investors.
The stock market should be a unique kind of casino, where the average person wins money over time. However, previous research shows that excessive stock market trading can contribute to financial losses --- just like in any other casino. While gambling research has documented the adverse consequences of problem gambling, there has been comparatively less behavioral finance research on the correlates of excessive stock market trading. This study aimed to document whether excessive stock trading was positively associated with problem gambling, and whether this hypothesized association was robust to controlling for demographics, and objective measures of overconfidence and financial literacy in a convenience sample of 798 US investors. We found that self-reported relative stock portfolio turnover was positively associated with problem gambling, that this association was robust to controls, and occurred equally over investors of all self-reported portfolio sizes. This study showed that problem gamblers may also make suboptimal risky choices more generally, and that a behavioral dependence explanation for suboptimal investment decisions should be subject to further investigation in the behavioral finance literature.
Purpose: Successful completion of higher education is a significant factor of both individual and national development. Self-esteem has been neglected in previous empirical research as a constraint in course completion. We investigate this factor as a basis to develop suitable interventions. Design/Method/Approach: We use secondary, administrative data of course completion from fully accredited Bachelor- and Master-courses at an Austrian higher education institution. Findings: Self-Esteem, using measures of social comparison and gender as proxies, lead to reductions of successful completion of higher education. Theoretical Implications: Internal constraints, i.e. fragile self-esteem, impacts course completion in higher education. Practical Implications: National and educational institutions aiming at supporting students should focus on emotional support programs alongside professional support programs. Originality/Value: We offer tentative first evidence of a novel theory on the impact of fragile self-esteem on intertemporal choices, applied to the context of higher education. Research Limitations/Future Research: An empirical analysis of higher education performance based on a model unifying both ability and self-esteem constraints would provide an ambitious, but interesting avenue for further research. Acknowledgement: We thank the participants of the Coffee, Cake & Research seminar in the department for Business Administration Online for insightful comments and feedback. We thank Brigitte Auer, Christina Hackhofer and Maria Pammer for helpful conversations. We thank Jochen Frühwirth for data retrieval. Paper type: Empirical
Purpose: While the demand for mental health services increases, supply often stagnates. Providing treatment to those most in need is an important factor in its efficient distribution. We propose and conduct a statistical procedure for detecting rater-biases in patient prioritization tools. Design / Method / Approach: We gather real-life data from 266 illness severity assessments in an Austrian publicly funded mental health service provider, including a rich set of covariates. To ensure robustness, we merge this data with determinants of mental health and assessment identified by previous research, such as weather or seasonal indicators. Findings: We find statistically significant effects of rater-biases. These effects are robust to a large array of controls. Practical Implications: A back-of-the-envelope calculation reveals that the identified rater effects can translate to large changes in the waiting times for patients. Misspecified treatment allocations may lead to worsened symptoms and potentially fatal outcomes. Originality / Value: Although a growing literature focuses on patient prioritization tools, many articles study these in synthetic contexts using “vignettes”. In comparison, our study adds external validity by considering real-life treatments in the field. Research Limitations / Future Research: This study can be used as a starting point for deeper, causally focused studies. Disclaimer: In accordance with publisher policies and our ethical obligations as researchers, we report that one of the authors is employed at a company that may be affected by the research reported in the enclosed paper. We have disclosed those interests fully. Paper type: Empirical
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