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The consequences of perceived risk and objective knowledge for consumers’ investment behavior

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  • Juha Munnukka

    (University of Jyväskylä)

  • Outi Uusitalo

    (University of Jyväskylä)

  • Veera-Juulia Koivisto

    (University of Jyväskylä)

Abstract

Knowledge and risks have a focal role in consumer behavior. However, studies on consumers’ perceive risks in decision situations and the influence of objective knowledge and experience on risk perceptions, consumers’ attitudes and behavioral intentions are scarce. This paper introduces and tests a novel conceptual model that shows how consumers’ objective financial knowledge and investing experience affect their future investment intentions mediated by perceived risks, and attitudes toward investing. The data were analyzed using structural equation modeling. The proposed model fits the data and accounts for attitudes and intentions to investing. This study advances knowledge by directly measuring the behavior-related objective knowledge and experience. We also suggest new insights into the risk concept by showing that consumers perceive five types of risk in investing context and objective financial knowledge and investment experience has varying effects on different risks types, attitudes and intentions. The results also show significant gender differences.

Suggested Citation

  • Juha Munnukka & Outi Uusitalo & Veera-Juulia Koivisto, 2017. "The consequences of perceived risk and objective knowledge for consumers’ investment behavior," Journal of Financial Services Marketing, Palgrave Macmillan, vol. 22(4), pages 150-160, December.
    • Handle: RePEc:pal:jofsma:v:22:y:2017:i:4:d:10.1057_s41264-017-0033-6
    DOI: 10.1057/s41264-017-0033-6
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    Cited by:

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    3. Lin Li, 2023. "Investigating risk assessment in post-pandemic household cryptocurrency investments: an explainable machine learning approach," Journal of Asset Management, Palgrave Macmillan, vol. 24(4), pages 255-267, July.
    4. Yu Zhang & Swarn Chatterjee, 2023. "Financial Well-Being in the United States: The Roles of Financial Literacy and Financial Stress," Sustainability, MDPI, vol. 15(5), pages 1-18, March.

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