Locus of Control and Savings

By D. Cobb-Clark, Sonja C. Kassenboehmer, Mathias Sinning. Social Science Research Network, 2016

235 citations recorded by the source corpus.

This paper analyzes the relationship between individuals’ locus of control and their savings behavior, i.e. wealth accumulation, savings rates, and portfolio choices. Locus of control is a psychological concept that captures individuals’ beliefs about the controllability of life events and is a key component of self-control. We find that households with an internal reference person save more both in terms of levels and as a percentage of their permanent incomes. Although the locus-of-control gap in savings rates is largest among rich households, the gap in wealth accumulation is particularly large for poor households. Finally, households with an internal reference person and average net worth hold significantly less financial wealth, but significantly more pension wealth, than otherwise similar households with an external reference person.

Subfields: Accounting, Economics and Econometrics, Social Psychology

View Paper: https://www.semanticscholar.org/paper/8702f896cd13e826464efd42101d9b9e7c6a3132

How researchers see this paper

The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.

In Accounting

1. A. Gerged
2. Patrick Gerhard
3. Rr. Iramani
4. Lutfi Lutfi
5. J. Gladstone
6. Arvid O. I. Hoffmann

In Economics and Econometrics

1. A. Gerged
2. Patrick Gerhard
3. Rr. Iramani
4. Lutfi Lutfi
5. J. Gladstone
6. Arvid O. I. Hoffmann

In Social Psychology

1. A. Gerged
2. Rr. Iramani
3. Lutfi Lutfi
4. Arvid O. I. Hoffmann

Citations in the corpus

• Psychological characteristics and household savings behavior: The importance of accounting for latent heterogeneity (2018, background): “28 findings are in line with those of Mosca and McCrory (2016), who found that the effect of personality traits on wealth accumulation was only significant for those at the lower end of the wealth distribution, and those of Cobb-Clark et al. (2016), who found that the psychological characteristic of”
• Factors affecting corporate environmental disclosure in emerging markets: The role of corporate governance structures (2020, methodology): “First, a PQR regression is more robust to outliers than least squares regression method; Second, it is considered as a semiparametric by avoiding assumptions related to the parametric distribution of the error process (Cobb-Clark et al., 2016; Powell, 2016; Baum, 2013).”
• An integrated model of financial well-being: The role of financial behavior (2021, background): “…depends on oneself encourages a person to have better financial behavior, such as paying bills on time, setting aside income for savings and investment, controlling expenses, and setting aside funds for pensions and insurance (Britt et al., 2013; Cobb-Clark et al., 2016; Perry & Morris, 2005).”
• Locus of control and the labor market (2015, unknown): “Those with an internal locus of control also save more (Cobb-Clark et al. 2013).”