From pandemics to portfolios: Long-term impacts of the 2009 H1N1 outbreak on household investment choices

Naijia Guo, Charles Ka Yui Leung, Shumeng Zhang*

*Corresponding author for this work

Research output: Journal Publications and ReviewsRGC 21 - Publication in refereed journalpeer-review

Abstract

This study examines how experiencing a pandemic affects household investment behaviors. By leveraging cross-state variations in the H1N1 mortality rate in 2009, our difference-in-differences analysis reveals interesting findings. Although the pandemic does not significantly affect stock market participation, it depresses the proportion of liquid assets invested in risky assets among households who participate in the stock market. This effect persists for up to eight years after the pandemic and is particularly pronounced among households characterized by higher risk aversion and greater income volatility. Analysis conducted using different datasets consistently suggests that the pandemic primarily influences portfolio choices through a shift in risk attitudes. © 2025 Elsevier B.V.
Original languageEnglish
Article number106931
JournalJournal of Economic Behavior and Organization
Volume231
Online published19 Feb 2025
DOIs
Publication statusPublished - Mar 2025

Research Keywords

  • Pandemic
  • Portfolio choice
  • Risky share
  • Risk attitude

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