Does cultural economics affect country’s competitiveness?

Abstract

Purpose: The aim of this paper is to identify the relationship between demographic factors (gender, marital status , age, income, occupation, education, investment experience) and financial literacy and different behavioural biases. Research Methodology: The study uses one way ANOVA, t- test, multiple regression analysis to investigate the survey data collected from 515 individual investors. the research used purposive and snowball sampling to collect the data. Findings: the result of multiple regression revealed that demographic characteristics and financial literacy highly influence overconfidence, representativeness, anchoring, mental accounting, loss aversion and disposition bias. Age, occupation, investment experience, and financial literacy are found to be the most prevalent demographic variables associated with the behavioral biases of individual investors. Research Implications: This research can improve the efficacy of financial services, enable investors to make more informed choices, and promote overall financial well-being. This research will be beneficial for policy makers, financial organizations, financial advisors and individual investors. Originality: Through the comprehensive literature review, it is found that limited researches have been done to identify the relationship between demographic variables, financial literacy and behavioural biases. Therefore, this study is conducted to the existing research gap in the field of bahvioural finance.

Keyword : Behavioural Biases, Demographic Factors, Financial Literacy, Indian Individual Investors.