Portfolio Choice in the Presence of Nontradeable Income: An Experimental Analysis
Alexander Klos () and
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Alexander Klos: Sonderforschungsbereich 504, Postal: L 13, 15, D-68131 Mannheim
No 04-01, Sonderforschungsbereich 504 Publications from Sonderforschungsbereich 504, Universität Mannheim, Sonderforschungsbereich 504, University of Mannheim
This paper reports the results of experiments on portfolio choice in the presence of nontradeable income. The nontradeable income part could either be riskless or risky (background risk). In many cases, we observe behavior which is qualitatively consistent with the predictions of normative theory. However, correlations between financial and nontradeable wealth are neglected. The computation of aggregated risk profiles helps subjects to partly overcome the deviations from normative theory due to neglect of correlations.
Note: Financial support from the Deutsche Forschungsgemeinschaft, SFB 504, at the University of Mannheim, is gratefully acknowledged.
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Journal Article: Portfolio Choice in the Presence of Non‐Tradable Income: An Experimental Analysis (2006)
Journal Article: Portfolio Choice in the Presence of Non-Tradable Income: An Experimental Analysis (2006)
Working Paper: Portfolio choice in the presence of nontradeable income: an experimental analysis (2004)
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