ABSTRACT
This paper explores the link between personal experience with COVID-19 and US retail investors' financial decision-making during the first COVID-19 wave. Do retail investors that have personally experienced COVID-19 change their investments after the pandemic outbreak, and if so, why? We use a cross-sectional dataset from an online survey of US retail investors collected in July and August 2020 to assess if and how respondents change their investment decisions after the COVID-19 outbreak. On average retail investors increase their investments during the first wave of COVID-19 by 4.7%, while many of them decrease their investments suggesting a high heterogeneity of investor behaviours. We provide the first evidence that personal experience with the virus can have unexpected positive effects on retail investments. Investors who have personal experience with COVID-19, who are in a vulnerable health category, who tested positive, and who know someone in their close circle of friends or family who died because of COVID-19, increase their investments by 12%. We explain our findings through terror management theory, salience theory and optimism bias, suggesting that reminders of mortality, focussing on selective salient investment information, and over-optimism despite personal vulnerable health contribute to the increase in retail investments. Increased levels of savings, saving goals and risk capacity are also positively associated with increased investments. Our findings are relevant to investors, regulators, and financial advisors, and highlight the importance of providing retail investors with access to investment opportunities in periods of unprecedented shocks such as COVID-19.
ABSTRACT
The purpose of this study is to examine the question of how crises influence the decision-making of Hungarian university students. Crises increase the risk of sustainability, so it is crucial to make appropriate financial decisions in such a situation. For this purpose, the authors conducted a two-stage questionnaire survey among students of economics and other majors. The inquiries took place in 2019 (n = 1558) and 2020 (n = 1712). A regression study was used to analyse the evolution of financial attitudes and investment knowledge, as well as how they are affected by a potential crisis modelled with the COVID-19 pandemic. It has been shown that interest in financial matters increases as a result of the crisis and the level of financial knowledge also increases. However, the most important conclusion of the study is that, in the event of a high threat, knowledge and practice can only be combined with calm thinking to help make appropriate financial decisions. All of this together ensures that investment decisions are the basis for the sustainability of personal finances.
ABSTRACT
COVID-19 has caused not only unprecedented health crises but also economic crises among individuals across the world. White-collar (salaried-class) employees with a fixed salary face financial insecurity due to job loss, pay cuts and uncertainty in retaining a job. This study examines the financial behavior of Indian white-collar salariedclass investors to their cognitive biases. In addition, the mediating effect of financial self-efficacy on cognitive biases and financial behavior is examined. Respondents were given structured questionnaires (google forms) through emails and WhatsApp for data collection. SPSS and R-PLS are used to analyze the data. Conservatism (r = -.603, p < 0.05) and herding bias (r = -.703, p < 0.05) have a significant negative correlation with financial behavior. Financial self-efficacy has a significant positive correlation (r =.621. p < 0.050). Conservatism and herding predicted 60.5% and 62.2% of the variance, respectively. The direct and indirect paths between conservatism bias, financial self-efficacy, and financial behavior are significant. The paths between herding, financial self-efficacy and financial behavior are also significant. © Ankita Mulasi, Jain Mathew, Kavitha Desai, 2022.
ABSTRACT
The growing uncertainty in today's business environment has a significant influence on social business's behaviour. Those enterprises could rely on public support in the past, but nowadays, they have to find a way to be more responsible about their social activity and be financially independent on public resources. Based on this theoretical background, the paper's main goal was to find a set of factors that influence crucial financial decisions within a crisis. When social businesses create an optimal financial portfolio to be financially sustainable, primary research was conducted. A sample of 57 social businesses was asked about their financial strategy. The main research goal was to compare a change before and after the first wave of the Covid-19 pandemic situation in 2020. This case has shown current financial thinking and preparedness for unusual or crises. A mixed research approach was chosen due to a limited number of respondents. The overall results found that those businesses prefer to use the current strategy (42%) in crisis, and they limit investments to survive in that situation, except marketing investments (16%). Implications for Central European audience: At the theoretical level, our study shows social enterprise concepts in the Central European context, which differs somewhat from the already established definition of mainly Anglo-Saxon and American authors. At the same time, it combines knowledge about the use of financial planning in this segment. The study results show that financial planning is essential in these companies because it can achieve social goals. A discussion would be opened on how to raise awareness of the preparation of the strategy. Alternatively, how to strengthen the financial literacy of managers or representatives of these entities. © 2022. All Rights Reserved.
ABSTRACT
Foreign Direct Investment (FDI) plays an imperative role for the growth of the business sector and contributes to a significant level towards economic growth. It facilitates flow of funds towards poor and developing countries to establish business units, to raise their production capacity and to offer ample employment opportunities to unemployed youth, to raise labor skills by transfer of technology and managerial know-how, thereby FDI tries to assimilate domestic economy with the global economy. But because of COVID-19, there is a massive setback for various countries in attracting FDI, India is not an exception to it. The present study tries to critically analyze the impact of ongoing pandemic on FDI inflows in India. Thus, an attempt has been made in this study to ascertain the impact of COVID-19 on FDI in India and make recommendations to attract more FDI.
ABSTRACT
This paper has set itself the objective of studying the importance and the solutions proposed by these artificial intelligence tools to financial decision-making in times of crisis. To meet our objective, we proceeded with a review and schematization of Artificial Intelligence (AI) to address the impacts of COVID on financial markets and corporate financial decisions. In sum, regarding financial decisions perspectives, the more AI investments are amplified, the more low-cost, innovative, and effective solutions can be adopted. However, replacing managers’ knowledge and expertise is still a challenging task. For that, the management team and AI experts’ collaboration is required to soften the digital transformation, survey the market variations, and implement effective solutions. © 2022, The Author(s), under exclusive license to Springer Nature Switzerland AG.