What I Know, What I Think I Know, and Whom I Know

Drawing on social cognitive theory and social network literature, this study examines how objective financial knowledge (OFK) and financial knowledge network intensity (FKNI) influence retirement investment decisions through the mediation of subjective financial knowledge (SFK). Using survey data, w...

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Bibliographic Details
Published inThe Journal of consumer affairs Vol. 53; no. 3; pp. 1312 - 1349
Main Authors Chung, Yunhyung, Park, Youngkyun
Format Journal Article
LanguageEnglish
Published Malden, USA Wiley Periodicals, Inc 01.09.2019
Blackwell Publishing Ltd
Subjects
Employee benefits
Investments
Mediation
Retirement
Risk
Social networks
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Summary:Drawing on social cognitive theory and social network literature, this study examines how objective financial knowledge (OFK) and financial knowledge network intensity (FKNI) influence retirement investment decisions through the mediation of subjective financial knowledge (SFK). Using survey data, we find that OFK and FKNI enhance 401(k) account holders' risk‐taking and investment quality. We also find a unique role of SFK in retirement investment decisions: SFK mediates the effect of OFK on risk‐taking, not on investment decision quality. While the interaction between OFK and FKNI does not influence investment decision quality through SFK, it does positively influence risk‐taking through the mediation of SFK, which implies that OFK and FKNI serve as complements to each other in risk‐taking through the mediation of SFK. We suggest that individuals may reap benefits from financial literacy and financial network‐building programs for improving retirement investment decision‐making.
ISSN:0022-0078
1745-6606
DOI:10.1111/joca.12231