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National differences in gambling-driven stock trading behavior: evidence from a simulated trading game

Author

Listed:
  • Moritz Mosenhauer

    (Universitätstrasse 15)

  • Jakob Windisch

    (Universitätstrasse 15)

Abstract

There are significant differences in real-life gambling behavior between Germany and Italy. Contemporary theories suggest that these differences in individual preferences would translate to differences in trading behavior. We elicited trading behavior from participants of both Italian and German language groups using a stylized hold-or-trade scenario distributed via a survey. Additionally, we collected data on their self-stated gambling preferences. Our findings confirm the existence of large and significant differences in gambling consumption, problem gambling, and trading behavior between the two nationalities. Furthermore, we observed that gambling preferences explain most of the national differences. This suggests that established factors of financial decision-making play a more prominent role in explaining national differences in trading behavior than any latent cultural factors.

Suggested Citation

  • Moritz Mosenhauer & Jakob Windisch, 2024. "National differences in gambling-driven stock trading behavior: evidence from a simulated trading game," Financial Markets and Portfolio Management, Springer;Swiss Society for Financial Market Research, vol. 38(4), pages 515-531, December.
    • Handle: RePEc:kap:fmktpm:v:38:y:2024:i:4:d:10.1007_s11408-024-00460-7
    DOI: 10.1007/s11408-024-00460-7
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    References listed on IDEAS

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    1. Maximilian Koestner & Benjamin Loos & Steffen Meyer & Andreas Hackethal, 2017. "Do individual investors learn from their mistakes?," Journal of Business Economics, Springer, vol. 87(5), pages 669-703, July.
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    More about this item

    Keywords

    Excessive trading; Problem gambling; Trading bias;
    All these keywords.

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets
    • G50 - Financial Economics - - Household Finance - - - General

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