Search results

The purpose of this paper is to investigate the impact of financial literacy, risk attitude, and saving motives on the attenuation of mutual fund investors’ disposition bias. Specifically, the authors focus on individual characteristics explaining the investors’ propensity to sell shares in a poorly performing mutual fund.

The study relies on survey data collected from 1,564 Swedish households in 2013. The authors test the hypotheses considering three different portfolio compositions and portfolio performances. Each composition corresponds to a dependent variable and a separate model which are estimated using ordinal logistic regression.

The authors find that different forms of financial literacy affect attenuation of the disposition effect. Specifically, the authors find that knowledge about mutual funds and knowledge about current market conditions affect the attenuation of the disposition effect, whereas the authors find no support for the effect of “technical financial knowledge” (e.g. the ability to calculate compound interest rates). The authors also find no support for the effects of risk attitude and saving motives on the attenuation of the disposition bias.

The findings suggest a need for a more fine-grained conceptualization of the financial literacy concept and its effect on investors’ disposition bias. Since an important implication of the findings is that financial literacy could potentially help people overcome behavioral bias, the study provides insights for policymakers as well as into the discussion on the design of consumer education programs.

The purpose of this paper is to explore the relationship between formal ethics and ethics in practice in the empirical context of real estate agents (REAs) working in the residential housing market, including owner-occupied houses and owner-occupied apartments, in Sweden. The paper investigates problems with the Swedish middleman model of real estate agency with regard to the acceptance among REAs of borderline professional behavior.

We report on a survey distributed to all Swedish licensed residential REAs to investigate their attitudes towards eight scenarios displaying borderline ethical behavior. Firstly, the means of each scenario were calculated, investigating signs of distance between formal ethics and ethics in practice. Secondly, logistic regressions were run for each scenario separately, thereby investigating factors affecting misconduct among REAs.

The empirical results show a clear difference between formal ethics and ethics in practice and also illustrate that some scenarios of borderline ethical behavior are creating greater problems for the REAs.

In Sweden, the seller is the principal, assigning the REA to sell a house or apartment, but the regulation is clear on the role of the licensed REA as responsible for promoting an informed and fair sales process where the buyer is safe to act without their own representative. Our study contributes with information to policymakers on possible areas for the development of the middleman model.

The paper is the first to empirically investigate the middleman model of a Swedish real estate agency in relation to the business ethics of the agents. The use of scenarios in close relation to the everyday working context of REAs as tests of ethics of practice is also of original methodological value to investigate possible diversions of professionals from national regulations.

The purpose of this paper is to investigate driving forces behind mortgage rate choice among homeowners in a market of no mortgage rate spread. The study reported on was conducted in Sweden, a country relatively spared both from effects of the subprime crisis and the on-going Euro-crisis. A number of potentially influential factors, such as respondents’ risk aversion, financial vulnerability, experience, expectations as well as the impact of media and bank advisors are examined and a number of demographic factors controlled for.

The study reported on is based on data from a national randomized survey conducted in Sweden in 2012. An empirical analysis is carried out on a sample of 474 households with mortgages. A logistic regression is performed to test a model based on hypothesized factors.

The study shows that consumers choosing fixed rate mortgages (FRMs) have high LTV and high risk aversion and perceive their choice as having been influenced by bank advisors. This is in line with earlier findings. Lower levels of – or no – FRMs (more adjustable rate mortgages) seems to be attractive for the wealthier with higher education and previous experience of home owning. Other factor negatively affecting the choice of FRMs are: being younger; being influenced by media; and perceiving oneself as financially vulnerable.

To summarize, this paper contributes to research in two major ways: first, the Swedish case is modeled against a review of international research on mortgage rate choice. Second, a number of consumer-related factors are investigated, and their relative contribution as drivers of a choice of FRMs are tested. This gives input to more theoretical research conceptualizing a model for the understanding of how consumer mortgage rate choices are made.

The results should serve as an alarm bell for the industry, as the consumers described – the youngest mortgage holders, the financially vulnerable with low repayment capacity and those easily influenced by reports in media – are a potential threat to stable development of long term customer relations and mortgage portfolios.

The results gives reason for policy makers to address the question and reasons to call for more studies of the preferences and choices of the younger consumers.

This study represents an investigation into some factors not often studied in relation to mortgage rate choice. It also highlights the Swedish case and puts it in an international context.

This paper aims to investigate the relationships between advisor characteristics and consumer risk perception, willingness to follow advice and perception of advisor credibility in a financial services context. It answers calls for more knowledge about financial advisors’ influence on financial decision‐making among consumers.

An experimental study, displaying financial advice together with photographs of advisors, was completed by convenience sampling of 200 Swedish consumers and analysis using statistical techniques to compare groups: two‐way between‐groups ANOVA.

This study shows that advisor gender affected consumer risk perceptions, willingness to follow advice and perception of advisor credibility in a financial services context, whereas advisor mood affected only consumer willingness to follow advice. No biases depending on buyer–seller similarity were found.

The study focuses on consumer perceptions – not real‐life investment choices. Conclusions are drawn from a relatively small sample. However, the policy implications are important, suggesting that characteristics other than those of consumers (e.g. gender, educational level, occupation, financial literacy) can be of relevance for policymakers in their attempts to improve consumer protection.

The findings provide useful insights for marketing practitioners that could help adjust information disseminated to consumer segments and that could have implications for marketing and hiring practices in the financial sector.

This paper illustrates the role of advisor characteristics in consumer financial decision‐making and calls for more research on financial advisory services.

The purpose of this paper is to use psychological theory to improve our understanding of financial advice-taking. The paper studies how a working alliance between financial service customers and advisors affects the advisor's assessment of the financial service buyer's perceived risk preferences, and what role trust plays as a mediating variable.

The paper obtained data by means of a questionnaire that was answered by 375 matched pairs of bank advisors and customers.

This paper explains how the working alliance method – a concept from psychotherapeutic theory – between financial service customers and advisors affects the advisor's understanding of the financial service buyer's perceived risk preferences. The paper also finds that the role of trust is perceived differently by the advisor and the customer. Advisors see that as their clients learn to trust them they lose touch with the customer's perceived risk preferences, whereas customers do not perceive that their trust in the advisor has any relationship to their risk preferences.

This results suggest that advisors lose touch with the risk preferences of trusting customers, and that psychological methods are needed if the advisor should actually understand customer perceived risk preferences.

The paper advances psychological methods in marketing, and provides a partial answer to the difficulties of financial advice giving.

The purpose of this paper is to investigate consumer characteristics that influence Swedish consumers' mortgage rate decisions, such as the choice between an adjustable rate mortgage (ARM) and a fixed rate mortgage (FRM).

Data were collected in a randomised survey of the Swedish population in 2010. Through binary logistic regression, the effects of education, income and risk aversion on household mortgage decisions are investigated. In addition, consumers' financial literacy and self‐reported ability to handle sudden mortgage rate increases are examined. A test of gender effects is also performed.

The results show that a lower level of education, lower income, lower financial literacy, and trouble handling interest rate increases influence Swedish consumers to choose ARMs. Gender does not significantly affect the overall results. However, a gender‐divided regression shows that age, a low level of education and risk averseness significantly affect men's mortgage choices, whereas income, trouble handling interest rate increases and low financial literacy significantly affect women's mortgage choices.

The most vulnerable Swedish consumers choose FRMs to a greater extent and, thereby, make future expenditures more predictable for the single household by reducing liquidity risks.

This paper tests a number of characteristics in predicting consumers' mortgage choices, emphasises the importance of loan takers' ability to cope with sudden mortgage rate increases, highlights the importance of financial literacy in understanding consumers' financial choices and elucidates the Swedish case.

The purpose of this chapter is to investigate students’ qualitatively different ways of understanding the learning object in three undergraduate courses in the discipline of accounting. The theoretical framework of variation theory, a general learning theory, is applied. The lecturers chose a learning object which is investigated under two different teaching conditions – the conventional lecture model and the variational method. Two student groups were identified as a comparison group and a target group, comparable in various relevant parameters. All students took three required accounting courses. In the comparison group, the lecturers used the conventional lecture model and in the target group the variational model. The results indicated significant differences between the two groups’ examination results in the three courses, with students in the target group performing much better. The educational implications and limitations of the study, and areas for further research, are discussed.