Uncertainty, Trust and Herding Behaviour

Ray Saadaoui Mallek, Mohamed Albaity and Philip Molyneux ()
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Philip Molyneux: University of Sharjah, United Arab Emirates

Review of Development Finance Journal, 2021, vol. 11, issue 2, 94-106

Abstract: This study examined the impact of uncertainty and trust (in institutions) on the herding behaviour of investors in 32 OECD stock markets between 2003 and 2018. Overall, we found that uncertainty and trust weakened both investor’s herding and antiherding behaviour. Policymakers should focus on reducing the level of uncertainty, as well as improving institutional arrangements to mitigate the likelihood of price bubbles and potential crash risks.

Keywords: Uncertainty; Trust; Herding; Anti-herding (search for similar items in EconPapers)
JEL-codes: G15 G40 G41 (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:afj:journ3:v:11:y:2021:i:2:p:94-106

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