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Home | Events Archive | Stock Market Wealth and Worker Output

Stock Market Wealth and Worker Output

  • Series
    Erasmus Finance Seminars
  • Speaker(s)
    Wenlan Qian (National University of Singapore, Singapore)
  • Field
    Finance, Finance
  • Location
  • Date and time

    October 06, 2020
    10:00 - 11:15

Abstract: This paper uses individual-level data linking stock investments to work performance to examine how changes in stock market wealth affect worker output. Exploiting large return variations over time and across investors, we document a 10% increase in monthly stock investment returns is associated with a decrease of 3.9% in the same investor’s next-month work output. The negative output response is not driven by concurrent economic conditions, pronounced when focusing on more idiosyncratic stock investment returns, and moreover is unexplained by investor-specific liquidity needs. Consistent with the wealth-effect interpretation, the effect is stronger for higher-income workers. In the negative-return domain, interestingly, a decline in stock investment returns is followed by lower output, especially for male, younger, less educated, and lower-income workers. Overall, our results highlight a novel channel of transmitting stock market fluctuation to the real economy through labor supply.

Link to the seminar:

Zoom Meeting:


Meeting ID: 950 3622 7967

Psscode: please send an email to stolting@ese.eur.nl

Some information and suggestions:

  • Your microphone will be on mute upon joining the meeting, please leave it like that and unmute it only if you want to ask a question.
  • Asking questions: please go ahead and ask questions in the “usual way” (i.e., don’t use the chat unless you want to notify me/host of any problem related to the seminar).