Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/237340 
Year of Publication: 
2021
Series/Report no.: 
ECONtribute Discussion Paper No. 095
Publisher: 
University of Bonn and University of Cologne, Reinhard Selten Institute (RSI), Bonn and Cologne
Abstract: 
We show that financial advisors recommend more costly products to female clients, based on minutes from about 27,000 real-world advisory meetings and client portfolio data. Funds recom-mended to women have higher expense ratios controlling for risk, and women less often receive rebates on upfront fees for any given fund. We develop a model relating these findings to client stereotyping, and empirically verify an additional prediction: Women (but not men) with higher financial aptitude reject recommendations more frequently. Women state a preference for delegat-ing financial decisions, but appear unaware of associated higher costs. Evidence of stereotyping is stronger for male advisors.
Subjects: 
credence goods
financial aptitude
consumer protection
financial literacy
discrimination
JEL: 
G2
E2
D8
Document Type: 
Working Paper

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