2021: Verein für Socialpolitik, Online
Media Coverage: Spiegel Online
Abstract – We conducted a large-scale household survey in November 2020 to study how altering the time frame of a message (temporal framing) regarding an imminent positive income shock affects consumption plans. The income shock derives from the abolishment of the German solidarity surcharge on personal income taxes, effective in January 2021. We randomize across survey participants whether their extra disposable income is presented in Euros per month, Euros per year, or Euros per ten year-period. Our main findings are as follows: In General, we find our respondents’ intended Marginal Propensity to Consume (MPC) is 28.2%. Across all three treatments, the MPC is a positive function of age and being female while it is a negative function of the income increase’s size, self-control, and being unemployed. Temporal framing effects are statistically and economically highly significant as we find the monthly treatment groups’ average MPC 5.6 and 8.7 percentage points higher compared to the yearly and 10-yearly treatment groups. We will be able to analyze the real consumption behavior of households throughout 2021 based on re-surveying the participants as well as by using transaction-based bank data.
The Annual General Meeting revisited: The role of the CEO speech, with Christina Bannier and Andreas Walter.
2019: EFL Seminar, Frankfurt
2017: Verein für Socialpolitik, Vienna | DAFC, Lugano | VHB, Luzern
2016: DGF PhD Workshop, Bonn
Abstract - We analyze the informational value of the Annual General Meeting (AGM) for investors’ decision-making. As the AGM is typically preceded by several information disclosures, previous research has shown it to trigger only a marginal market reaction. We consider the tone of the CEO’s speech as a hitherto overlooked feature using textual analysis and compile a unique comprehensive dataset of 457 German AGMs between 2008 and 2016. We show that the sentiment of the CEO speech is significantly related to subsequent return reactions and firm profitability, even when controlling for further AGM-related events.
Trust and the supply side of financial advice, with Oscar Stolper and Andreas Walter.
2016: World Finance Conference, New York
2015: Deutsche Gesellschaft für Finanzwirtschaft (DGF) PhD Workshop, Leipzig
Abstract - In this study, we investigate how two key dimensions of trust formation, i.e. interpersonal trust in the advisor (narrow-scope trust) and broader trust in the business context in which the advisor operates (broad-scope trust), impact households’ overall trust in financial advice. To capture the potential influence of broad-scope trust, we make use of novel survey data obtained from the Panel on Household Finances (PHF) and contrast households’ propensity to trust financial advice provided by advisors employed at community banks versus large banks, which have been shown to feature fundamentally different trust profiles. We document that financial advice provided by large-bank advisors is significantly less likely to be trusted, thus rejecting the notion that trust in financial advice is essentially equivalent to trusting one’s financial advisor. Instead, we provide strong evidence in support of an integrated conceptualization of clients’ trust in financial advice, which highlights the importance of establishing broad-scope trust.