Market Impact Analysis of Financial Literacy among A-Share Market Investors: An Agent-Based Model
Financial literacy has become increasingly crucial in today’s complex financial markets. This paper explores the impact of financial literacy on the stock market by establishing an artificial financial market that aligns with the characteristics of the Chinese A-share market using agent-based modeli...
| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
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MDPI AG
2023-11-01
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| Series: | Entropy |
| Subjects: | |
| Online Access: | https://www.mdpi.com/1099-4300/25/12/1602 |
| _version_ | 1797381184708149248 |
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| author | Rongtian Zhou Xiong Xiong Bàrbara Llacay Gilbert Peffer |
| author_facet | Rongtian Zhou Xiong Xiong Bàrbara Llacay Gilbert Peffer |
| author_sort | Rongtian Zhou |
| collection | DOAJ |
| description | Financial literacy has become increasingly crucial in today’s complex financial markets. This paper explores the impact of financial literacy on the stock market by establishing an artificial financial market that aligns with the characteristics of the Chinese A-share market using agent-based modeling. The study incorporates financial literacy into investors’ mixed beliefs and simulates their behavior in the market. The results show that improving individual investors’ financial literacy can improve market quality and investor performance, as well as reduce the unequal distribution of wealth to some extent. However, the phenomenon of speculative trading and irrational behavior in the market can pose potential risks that require regulatory measures. Thus, policy recommendations to improve individual investors’ financial literacy and establish corresponding regulatory measures are proposed. |
| first_indexed | 2024-03-08T20:47:43Z |
| format | Article |
| id | doaj.art-522fec80e2f8454bb337e05fb5c7b6d8 |
| institution | Directory Open Access Journal |
| issn | 1099-4300 |
| language | English |
| last_indexed | 2024-03-08T20:47:43Z |
| publishDate | 2023-11-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Entropy |
| spelling | doaj.art-522fec80e2f8454bb337e05fb5c7b6d82023-12-22T14:07:19ZengMDPI AGEntropy1099-43002023-11-012512160210.3390/e25121602Market Impact Analysis of Financial Literacy among A-Share Market Investors: An Agent-Based ModelRongtian Zhou0Xiong Xiong1Bàrbara Llacay2Gilbert Peffer3College of Management and Economics, Tianjin University, Weijin Road 92, Tianjin 300072, ChinaLaboratory of Computation and Analytics of Complex Management Systems (CACMS), Tianjin University, Weijin Road 92, Tianjin 300072, ChinaDepartment of Business, Faculty of Economics and Business, University of Barcelona, Av. Diagonal 690, 08034 Barcelona, SpainIAFI Research Group, Faculty of Economics and Business, Av. Diagonal 690, 08034 Barcelona, SpainFinancial literacy has become increasingly crucial in today’s complex financial markets. This paper explores the impact of financial literacy on the stock market by establishing an artificial financial market that aligns with the characteristics of the Chinese A-share market using agent-based modeling. The study incorporates financial literacy into investors’ mixed beliefs and simulates their behavior in the market. The results show that improving individual investors’ financial literacy can improve market quality and investor performance, as well as reduce the unequal distribution of wealth to some extent. However, the phenomenon of speculative trading and irrational behavior in the market can pose potential risks that require regulatory measures. Thus, policy recommendations to improve individual investors’ financial literacy and establish corresponding regulatory measures are proposed.https://www.mdpi.com/1099-4300/25/12/1602financial literacyinvestor behaviouragent-based modelA-share market |
| spellingShingle | Rongtian Zhou Xiong Xiong Bàrbara Llacay Gilbert Peffer Market Impact Analysis of Financial Literacy among A-Share Market Investors: An Agent-Based Model Entropy financial literacy investor behaviour agent-based model A-share market |
| title | Market Impact Analysis of Financial Literacy among A-Share Market Investors: An Agent-Based Model |
| title_full | Market Impact Analysis of Financial Literacy among A-Share Market Investors: An Agent-Based Model |
| title_fullStr | Market Impact Analysis of Financial Literacy among A-Share Market Investors: An Agent-Based Model |
| title_full_unstemmed | Market Impact Analysis of Financial Literacy among A-Share Market Investors: An Agent-Based Model |
| title_short | Market Impact Analysis of Financial Literacy among A-Share Market Investors: An Agent-Based Model |
| title_sort | market impact analysis of financial literacy among a share market investors an agent based model |
| topic | financial literacy investor behaviour agent-based model A-share market |
| url | https://www.mdpi.com/1099-4300/25/12/1602 |
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