Research On The Impact Of Subjective Well-being On Household Financial Market Participatio

With the continuous development and improvement of China’s economic level,people’s living standards and happiness have been improved.With the increase of income and the diversification of investment varieties,residents’ participation in the financial market has increased.However,compared with western countries,China’s financial market presents the phenomenon of limited participation,the structure of financial asset allocation is single,and the proportion of low-risk financial assets such as cash and deposits is huge.A single financial market will lead to many problems and greatly restrict the development process of the financial market.In the subjective field,personal emotions deeply impact household financial market participation.Happiness is representative of residents’ subjective emotions.As an emerging topic,studying the impact of happiness on family financial market participation is of positive significance to solve the limited participation in China’s financial market."Family finance" is a hot topic in recent years,and the financial market is a key topic studied by scholars at home and abroad for many years.There are many factors affecting residents’ financial market participation,including personal factors such as gender,marriage,education,and other factors.There are also other factors,such as studying residents’ financial market participation through residents’ subjective attitudes,social interaction,and financial knowledge level;With the improvement of people’s living standards in recent years,some scholars gradually pay attention to the residents themselves,study the impact of financial market participation on well-being and the impact of subjective well-being on asset allocation.This paper firstly summarizes the relevant achievements of domestic and foreign scholars,then puts forward the research hypothesis based on the portfolio theory and other theories,and constructs the relevant empirical model.This paper uses the household financial data of Southwest University of Finance and economics in 2019,selects the happiness of residents as the explanatory variable,and selects families with at least one of bank deposits,bonds and so on as the families participating in the financial market,Define two variables: the breadth of family financial market participation(the dummy variable of whether to participate in the financial market)and the depth of participation(the proportion of family-owned financial assets in total assets)as the explanatory variables respectively to study the impact of subjective well-being on family financial market participation.To eliminate the endogenous influence,the instrumental variable of rainfall is introduced.Ivprobit and Tobit’s models are used to analyze the relationship between well-being and the participation rate of the family financial market and the proportion of venture capital,and the conclusion is that subjective well-being is significantly negatively correlated with family financial market participation.Further,this paper divides household financial market participation into low-risk market participation and high-risk market participation and studies the impact of well-being on financial markets with different risks.The results are consistent with those of financial market participation.Then,by reducing the sample size of age,replacing explanatory variables and explained variables,this paper makes a robustness test and draws the same conclusion as the hypothesis.At the same time,this paper analyzes the mechanism of risk preference by dividing sub-samples and concludes that risk aversion and risk-neutral risk-neutral family happiness are significantly negatively correlated with financial market participation.The higher residents’ happiness is,the more willing they are to maintain the status quo and the less willing they are to participate in the financial market;By dividing sub-samples for regional heterogeneity analysis,it is concluded that the subjective well-being and family financial market participation of residents in the eastern and central regions are significantly negative,which shows that the higher the degree of happiness of residents in the eastern and central regions,the lower the probability of participating in the financial market,which is consistent with the results of the full sample test,which proves the hypothesis of this paper.The study provides ideas for solving the problem of limited participation in China’s financial market.For government,we can strengthen leadership.Happiness is an important issue of concern in today’s society.While ensuring the steady improvement of residents’ happiness,changing residents’ concept and increasing residents’ income,to improve residents’ participation in the financial market,is an important issue in our current research.For financial institutions,we can capture potential customers by studying the relationship between residents’ well-being and financial market participation,improve the success rate of financial transactions and the efficiency of financial markets.In the process of product recommendation,we can also recommend low-risk financial assets to families with higher happiness ratings,such as government bonds,deposits,and other stable investment products;In the face of families with low happiness ratings,they recommend more risky financial assets s.In addition,institutions can carry out financial innovation to make the innovation of financial products meet the requirements of residents.Due to the low enthusiasm of residents’ participation in the financial market,it is necessary to strengthen residents’ understanding and understanding of financial knowledge and improve residents’ financial education;At the same time,it can develop more financial products with higher income and less risk,and promote the transition of residents’ financial assets from savings to financial management.