Early‐Life Famine Experience and Households’ Diversity of Financial Asset Portfolio: Evidence From China

Shulin Xu and Zhen Yang

Social Science Quarterly, 2025, vol. 106, issue 2

Abstract: Objective Based on imprinting theory, this study investigates the impact of famine experience on household portfolio diversification, focusing on the three core elements of imprint formation: sensitive period, environmental imprint, and lasting impact. Method Using data from the 2013–2019 China Household Finance Survey, we examine how early‐life famine experience affects household investment choices by applying ordinary least squares (OLS) and ordered probit models. Results We find that household heads who experienced famine during childhood tend to hold more stocks and other risky financial assets, leading to more diverse investment portfolios. Further, the impact of famine experience is greater in urban areas and for households with low levels of education and financial literacy. Mechanism analyses reveal that famine experience leads to risk aversion, which increases the diversity of household investments. However, the effect of famine experience weakens over time as the gap between experience and survey period grows. Conclusion The study offers new insights into how early‐life famine experience shapes household investment behaviors. The findings deepen our understanding of how psychological factors, rooted in early adversities, influence financial portfolio choices, contributing to both upper echelons theory and behavioral finance research.

Date: 2025
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