Risk Perception,Social Interaction And Household Stock Market Participation

China's stock market volatiles unusually at present.Due to the high information density of the stock market,it requires investors to invest rationally and have a higher level of risk perception in the stock market.Based on the current household finance theory,this paper introduces the risk perception in consumer psychology,and constructs the risk perception based on the subjective evaluation of the risk degree of the stock market.It also introduces the new factors such as social interaction in sociology and financial literacy in human capital,and establishes a theoretical framework for household financial market participation.In addition to analyzing the impact of the three major factors such as demographic characteristics,risk appetite and background risk factors on the household financial market participation,this paper also analyzes the impact of risk perception,social interaction and financial literacy on the stock participation,and focuses on the interaction impact between social interaction,financial literacy and risk perception on the participation of household stock market.In the empirical work,the survey data of China's urban household consumption financial research(CCFR)from Tsinghua University in 2012 is used in this paper.By using the Probit measurement model,the financial literacy is used as the control variable in the conventional model for the first time,and the social interaction is divided into one-way passive social interaction and two-way active social interaction,financial literacy is also divided into basic financial literacy and advanced financial literacy.This paper examines the influencing factors of the participation of the household stock market,and focuses on the conditional effect between risk perception and social interaction,financial literacy.In addition,we also examine the important role of demographic characteristics,risk attitudes and background risk factors in the impact on household financial behavior.In this paper,it is found that the risk perception level of the residents has a tendency to rise and then fall in the stock market.The advanced financial literacy can significantly promote the participation of the family financial market.With the deepening of the two-way active social interaction,investors are more likely to participate in the stock market.While investors are more likely not to invest in the stock market by amending the risk perceptions of stock market through the two-way active social interaction.People who have low advanced financial literacy are the biggest beneficiary to enhance the stock market participation rate through the impact of risk awareness and social interaction.In addition,the risk appetite,the total population of the family,the total wealth of the family,real estate investment have a significant impact on stock market participation,and these results are consistent with previous studies.Risk perception plays an important role in stock market investment decision-making.It studies the empirical research of risk perception and social interaction on the participation of household stock market,and makes appropriate suggestions for residents to raise their perceptions of the risks of specific financial products.The financial supervision authorities should actively promote financial knowledge popularization,expand social interaction channels,improve the financial literacy and risk perception of investors,so as to promote household rational investment.