Why Do Investors Hold Socially Responsible Mutual Funds?

Arno Riedl and Paul Smeets

No 4403, CESifo Working Paper Series from CESifo

Abstract: To understand why investors hold socially responsible mutual funds, we link administrative data to survey responses and behavior in incentivized experiments. We find that both social preferences and social signaling explain socially responsible investment (SRI) decisions. Financial motives play less of a role. Socially responsible investors in our sample expect to earn lower returns on SRI funds than on conventional funds and pay higher management fees. This suggests that investors are willing to forgo financial performance in order to invest in accordance with their social preferences.

Keywords: experimental finance; social preferences; socially responsible investments; mutual funds (search for similar items in EconPapers)
JEL-codes: C90 D64 G11 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Journal Article: Why Do Investors Hold Socially Responsible Mutual Funds? (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_4403

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