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Household financial decision making

Agarwal, Sumit and Mannil, Nithin (2023) Household financial decision making. In: Hilary, Gilles and McLean, David, (eds.) Handbook of Financial Decision Making. Research Handbooks in Money and Finance series. Elgar, Cheltenham, UK, 375 - 410. ISBN 9781802204162

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Identification Number: 10.4337/9781802204179.00033


We survey the literature studying household financial decision making. Our chapter would focus on how households make decisions regarding their consumption, savings, investment and borrowing. We explore the basic theoretical foundations underpinning each household decision followed by a summary of important empirical results in the literature. We discuss studies that fall within following four themes - 1) how households deviate from the utility maximizing rational behaviour while making financial decisions; 2) role of government, central banks, regulators, financial institutions and external factors in influencing household decisions; 3) household heterogeneity in financial decision making; and 4) similarities and differences in household behavior across countries and between developed and developing countries. We also look at how recent development in fintech has revolutionized the way households interact with fintech platforms in lending, payments, investments and trading.

Item Type: Book Section
Official URL:
Additional Information: © 2023 The Editors
Divisions: Finance
Subjects: H Social Sciences > HB Economic Theory
H Social Sciences > HG Finance
H Social Sciences > HF Commerce > HF5601 Accounting
Date Deposited: 10 Oct 2023 13:27
Last Modified: 22 Jul 2024 01:37

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