Informative social interactions

We collect survey data from a representative population sample to examine whether informative social interactions significantly in uence perceptions of past returns, expectations, participation and exposure to a widely known financial instrument in a developed economy with multiple information sources. Respondents report perceptions about peers with whom they discuss financial matters, their social circle, and the population.
We provide evidence for the presence of an information channel through which social interactions in uence perceptions and expectations about stock returns, stock market participation and portfolio share. We find only mixed evidence of mindless imitation of peers, permeating fewer layers of financial behavior.