Could French and Eurozone Savers Invest More in Risky Assets?

Luc Arrondel and André Masson
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André Masson: PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PSE - Paris-Jourdan Sciences Economiques - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique

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Abstract: During the crisis, French savers are turning even more towards safe, short-term assets or real estate and away from more risky and long-term financial investments. This state of affairs is a cause of concern to some analysts, who are looking for ways to encourage households to take more risks and put more of their savings into productive investment. Theoretical and statistical analysis show that this reluctance to invest in the stock market comes as much from the supply side – transaction costs in the broad sense, relatively unfavourable taxation that reduces the expected return – as from the demand side – lack of financial education among savers, aversion to risks perceived as being too high, exposure to other risks (income, unemployment, family, health, housing, human capital). In this article, after analyzing financial behaviours in France and Europe, we propose a number of propositions for redirecting savings towards more risky investments.

Keywords: Individual portfolio choice; Household financial decisions; Risky asset demand; Cross country comparisons (search for similar items in EconPapers)
Date: 2015-09
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Published in Bankers Markets & Investors : an academic & professional review, 2015, 138 (138), pp.4-16

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Journal Article: Could French and Eurozone Savers Invest More in Risky Assets? (2015)
Working Paper: Could French and Eurozone Savers Invest More in Risky Assets? (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:pseptp:halshs-01203541

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