Determinants of Development of the Mutual Fund Industry. A Socio-Cultural Approach
Ingrid Dragota (),
Delia Tatu-Cornea and
Prague Economic Papers, 2016, vol. 2016, issue 4, 476-493
The mutual fund industry has grown considerably in many countries since the 1990s. Its evolution has been explained primarily in terms of its economic and financial determinants. We draw on a dynamic set of measures for socio-cultural values to explain the differential development of mutual funds across the world. Using a sample of 38 countries for the period 1996-2009, we find a positive relation between the perception of happiness and the size of the mutual fund industry. Freedom of choice, a feature of countries that are dominated by individualistic behaviours and values, has a positive impact on the development of the industry. We also explain the positive relation between individuals' preference for private ownership and the development of mutual funds. Moreover, we prove that the industry is larger in developed countries with greater stock market liquidity, with low ratios of remittance inflows to GDP, and in which the industry is older.
Keywords: socio-cultural values; mutual funds; financial development (search for similar items in EconPapers)
JEL-codes: A13 G23 Z13 (search for similar items in EconPapers)
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