Individual investors’ trading behavior and gender difference in tolerance of sex crimes: Evidence from a natural experiment

We present evidence that males are more tolerant of sex crimes than females. We exploit a natural experiment, in which a firm’s executive rapes a nine-year-old girl. Based on individual-level stock transaction data (over 0.2 million individual investors), we show that, after this crime, females are...

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Bibliographic Details
Published inJournal of empirical finance Vol. 73; pp. 349 - 368
Main Authors Gao, Huasheng, Liu, Zhengkai, Yang, Chloe Chunliu
Format Journal Article
LanguageEnglish
Published Elsevier B.V 01.09.2023
Subjects
Gender difference
Household finance
Individual investors
Stock trading
Tolerance of sex crimes
Tolerance of sex crimes
Stock trading
G41
Individual investors
Gender difference
Household finance
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Summary:We present evidence that males are more tolerant of sex crimes than females. We exploit a natural experiment, in which a firm’s executive rapes a nine-year-old girl. Based on individual-level stock transaction data (over 0.2 million individual investors), we show that, after this crime, females are less likely to purchase this firm’s stock than males. This result is stronger for females who are likely more averse to sex crimes. We also find that females’ intolerance of sex crimes reduces their trading profits, and that the gender difference toward sex crimes is significantly larger than the gender difference toward non-sexually-related scandals. •Males are more tolerant of sex crimes than females based on stock transaction after a rape incident of a firm’s executive.•Men buy the firm’s stock post-crime more than women.•Gender difference in tolerance of sex crimes is larger than non-sexual scandals, revealing distinct societal attitudes.
ISSN:0927-5398
1879-1727
DOI:10.1016/j.jempfin.2023.08.001