Skip to main content
. Author manuscript; available in PMC: 2017 Apr 28.
Published in final edited form as: J financ econ. 2016 Jan 20;119(3):559–577. doi: 10.1016/j.jfineco.2016.01.003

Table 4. Ambiguity aversion and stock market participation.

This table shows results of probit regressions in which the dependent variable equals one if the respondent participates in the stock market. In Column 1, the key independent variable is the Ambiguity Aversion measure. In Column 2, the key independent variable is an indicator variable equal to one if the respondent is ambiguity-averse. In Column 3, the key independent variable is the rank transformation of Ambiguity Aversion. All models include a constant term and controls for age, age-squared divided by a thousand, male, white, Hispanic, married, (ln) number of children (plus one), health, education, employment status, (ln) family income, wealth divided by a hundred thousand, participation in defined contribution or defined benefit plans, financial literacy, trust, risk aversion, question order, check question score, and missing data dummies. The sample size is N = 2,943. Of the initial 3,258 respondents in our American Life Panel survey, 188 were eliminated because they took less than two minutes to answer the survey questions, another 30 subjects did not complete the ambiguity questions, and 97 had missing socio-demographic information. All nonbinary variables are standardized. The table reports marginal effects. Standard errors are clustered by household and appear in brackets. *, **, and *** denote significance at the 10%, 5%, and 1% level, respectively.

Variable (1) (2) (3)
Ambiguity Aversion −0.020**  
[0.01]      
Ambiguity Aversion Dummy −0.039**  
[0.02]      
Ambiguity Aversion Rank −0.021**  
[0.01]      
Age −0.029      
[0.07]      		 −0.022      
[0.07]      		 −0.027      
[0.07]      
Age2 0.042      
[0.07]      		 0.036      
[0.07]      		 0.040      
[0.07]      
Male 0.005      
[0.02]      		 0.006      
[0.02]      		 0.006      
[0.02]      
White 0.045*    
[0.02]      		 0.047*    
[0.02]      		 0.045*    
[0.02]      
Hispanic −0.092***
[0.03]      		 −0.092***
[0.03]      		 −0.092***
[0.03]      
Married 0.051**  
[0.02]      		 0.052**  
[0.02]      		 0.051**  
[0.02]      
Number of Children −0.024**  
[0.01]      		 −0.024**  
[0.01]      		 −0.023**  
[0.01]      
Health 0.024**  
[0.01]      		 0.025**  
[0.01]      		 0.025**  
[0.01]      
High School −0.020      
[0.06]      		 −0.021      
[0.06]      		 −0.020      
[0.06]      
College+ 0.036      
[0.06]      		 0.034      
[0.06]      		 0.036      
[0.06]      
Employed 0.005      
[0.02]      		 0.005      
[0.02]      		 0.005      
[0.02]      
Family Income 0.053***
[0.02]      		 0.052***
[0.02]      		 0.053***
[0.02]      
Wealth 0.050***
[0.01]      		 0.050***
[0.01]      		 0.050***
[0.01]      
Defined Contribution 0.056**  
[0.02]      		 0.055**  
[0.02]      		 0.055**  
[0.02]      
Defined Benefit −0.054**  
[0.02]      		 −0.052**  
[0.02]      		 −0.053**  
[0.02]      
Financial Literacy 0.068***
[0.01]      		 0.068***
[0.01]      		 0.068***
[0.01]      
Trust −0.004      
[0.01]      		 −0.004      
[0.01]      		 −0.004      
[0.01]      
Risk Aversion 0.019**  
[0.01]      		 0.019**  
[0.01]      		 0.019**  
[0.01]      
Question Order 0.028      
[0.02]      		 0.029*    
[0.02]      		 0.030*    
[0.02]      
Errors on Check −0.029      
[0.02]      		 −0.032*    
[0.02]      		 −0.031      
[0.02]      
Controls and constant Yes       Yes       Yes      
N 2,943       2,943       2,943