Is Fintech driving household asset allocation towards the law of one price?

Yueli Xu, Binhua Guo, Shuwei Zhan and Yao Lu

Finance Research Letters, 2025, vol. 78, issue C

Abstract: The rapid advancement of Fintech has transformed financial markets, yet its impact on household asset allocation remains insufficiently explored. This study employs the Arrow-Debreu-McKenzie framework and data from the China Household Finance Survey to examine Fintech's "double-edged sword" effect. While Fintech enhances portfolio alignment with the Law of One Price by reducing costs and improving transparency, it also introduces deviations through information overload and herd behavior. The study finds that these effects vary significantly across income levels and between urban and rural households.

Keywords: Fintech; Household asset allocation; Law of One Price (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:78:y:2025:i:c:s1544612325003927

DOI: 10.1016/j.frl.2025.107129

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