The Impact of Gender and Group Processes on Investment Decisions

Brown University, Providence RI

Investigators

Abstract

Do people invest differently in groups than as individuals? Do men invest differently than women? This project looks at both issues by analyzing the stock portfolios of approximately 1000 investment clubs throughout the U.S. The issues at stake are important to scholars as well as to business managers and people in the financial industry. In the business world, most investment decisions are made in groups; in fact, some of the most important market movers are groups, such as the Federal Reserve Board. Yet little is known about how group settings affect investment decisions or performance. One of the most important aspects of group process is gender composition; for example, it has long been known in sociology that people behave very differently in same-sex groups versus "mixed company." By incorporating these insights, this study will build a more accurate theory of the social underpinnings of economic behavior.