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Conform to the norm. Peer information and sustainable investments

Author

Listed:
  • Grossmann, Max
  • Hackethal, Andreas
  • Laudi, Marten
  • Pauls, Thomas

Abstract

We conduct a field experiment with clients of a German universal bank to explore the impact of peer information on sustainable retail investments. Our results show that information about peers' inclination towards sustainable investing raises the amount allocated to stock funds labeled sustainable, when communicated during a buying decision. This effect is primarily driven by participants initially underestimating peers' propensity to invest sustainably. Further, treated individuals indicate an increased interest in additional information on sustainable investments, primarily on risk and return expectations. However, when analyzing account-level portfolio holding data over time, we detect no spillover effects of peer information on later sustainable investment decisions.

Suggested Citation

  • Grossmann, Max & Hackethal, Andreas & Laudi, Marten & Pauls, Thomas, 2023. "Conform to the norm. Peer information and sustainable investments," SAFE Working Paper Series 412, Leibniz Institute for Financial Research SAFE.
    • Handle: RePEc:zbw:safewp:280963
    DOI: 10.2139/ssrn.4673139
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    More about this item

    Keywords

    Household Finance; Sustainable Finance; Experimental Finance; Financial Advice;
    All these keywords.

    JEL classification:

    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments

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