In this project, we study how Norwegian households respond to monetary policy changes and how their asset allocation varies with their personal experience and education background. In particular, we look at the monetary policy shock and examines whether households transmit monetary policy through their financial investments. We also analyze the effect of personal experience in stock market crash. We find that following a large equity investment loss during the financial crisis, an individual investor tends to reduce the equity allocation and increase the portfolio concentration. In addition, we study education background and investigate if having a bachelor degree in economics and business education affect individuals' financial outcomes and trading behaviors in the future.
In this proposal, we aim to explore how individuals respond to monetary policy changes and how their asset allocation varies with personal traits, such as personal experience and education background. We plan to examine the following research topics using Norwegian data:
• Monetary Policy Shock and Heterogeneity in Household Portfolios
• Experiences in Stock Market Crash and Future Investment Decisions
• The Effect of Economics and Business Education on Financial Outcomes