Journal
AMERICAN ECONOMIC REVIEW-INSIGHTS
Volume 1, Issue 2, Pages 225-240Publisher
AMER ECONOMIC ASSOC
DOI: 10.1257/aeri.20180158
Keywords
-
Categories
Funding
- Sloan Foundation
Ask authors/readers for more resources
We use data on Indian stock portfolios to show that return heterogeneity is the primary contributor to increasing inequality of wealth held in risky assets by Indian individual investors. Return heterogeneity increases equity wealth inequality through two main channels, both of which are related to the prevalence of undiversified accounts that own relatively few stocks. First, some undiversified portfolios randomly do well, while others randomly do poorly. Second, larger accounts diversify more effectively and thereby earn higher average log returns even though their average simple returns are no higher than those of smaller accounts.
Authors
I am an author on this paper
Click your name to claim this paper and add it to your profile.
Reviews
Recommended
No Data Available