Gender Differences in Financial Advice

Tabea Bucher-Koenen (), Andreas Hackethal (), Johannes Koenen () and Christine Laudenbach ()

CRC TR 224 Discussion Paper Series from University of Bonn and University of Mannheim, Germany

Abstract: We show that financial advisors recommend more costly products to female clients, based on minutes from about 27,000 real-world advisory meetings and client portfolio data. Funds recommended to women have higher expense ratios controlling for risk, and women less often receive rebates on upfront fees for any given fund. We develop a model relating these findings to client stereotyping, and empirically verify an additional prediction: Women (but not men) with higher financial aptitude reject recommendations more frequently. Women state a preference for delegating financial decisions, but appear unaware of associated higher costs. Evidence of stereotyping is stronger for male advisors.

Keywords: credence goods; financial aptitude; consumer protection; financial literacy; discrimination (search for similar items in EconPapers)
JEL-codes: D8 E2 G2 (search for similar items in EconPapers)
Pages: 74
Date: 2021-03
New Economics Papers: this item is included in nep-cwa, nep-fle and nep-mac
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Citations: View citations in EconPapers (4)

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Working Paper: Gender Differences in Financial Advice (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:bon:boncrc:crctr224_2021_273

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