The Roots of Broadened Stock Ownership

Joshua Hall

No 16-06, Working Papers from Department of Economics, West Virginia University

Abstract: This analysis examines recent trends in stock ownership and explains the reasons for the dramatic increase in stock ownership among a broader and increasingly diverse number of Americans. The key reasons for this democratization of the stock market include: the popularization of the mutual fund; the general reduction in the multiple taxation of savings and investment that resulted from the genesis of the IRA and 401(k) plan; and the emphasis of the Federal Reserve on price stability which has lowered interest rates, stabilized financial markets, and acted as a de facto tax cut.

Keywords: stock ownership; mutual fund; IRA; 401(k); Federal Reserve (search for similar items in EconPapers)
Pages: 19 pages
Date: 2016-06
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