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Are We Becoming Greener? Life-time Experiences and Responsible Investment

Author

Listed:
  • Bianchi, Milo
  • Liu, Zhengkai
  • Wang, Gang

Abstract

We exploit account-level data from the Shanghai Stock Exchange to investigate how life-time experiences affect individual investors’ demand for ESG stocks. We show that ESG demand is shaped by economic and non-economic experiences, such as growing up in a region with more pro-social values, being exposed to increased pollution or to a natural disaster. Recent experiences tend to matter more, and noneconomic experiences are particularly important to explain how investors change their ESG demand during their trading life. We provide suggestive evidence that these experiences affect investors’ intrinsic preferences for ESG stocks.

Suggested Citation

  • Bianchi, Milo & Liu, Zhengkai & Wang, Gang, 2022. "Are We Becoming Greener? Life-time Experiences and Responsible Investment," TSE Working Papers 22-1382, Toulouse School of Economics (TSE).
    • Handle: RePEc:tse:wpaper:126861
    as

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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Responsible investment; experience effects; pro-social attitudes; ESG trading;
    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
    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth

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