Household gender disparity and portfolio choices

This paper examines how women’s economic empowerment within households affects financial portfolio choices. Using data from the Bank of Italy’s Survey on Household Income and Wealth for 2004–2020, we measure empowerment via the female income share and examine its association with participation in risky assets and the share of financial wealth invested in equities and private bonds. The results show that a higher female income share is, on average, associated with lower exposure to risky assets. However, this aggregate effect conceals a key asymmetry: in male-headed households, a greater female income share reduces risky investment, whereas in female-headed households it increases it. Tests based on imputed individual risk preferences provide little support for a bargaining model in which income shares reweight partners’ risk attitudes. Instead, the evidence supports a unitary decision-making framework à la Becker, in which the identity and confidence of the household financial decision-maker are central. Financial-sector employment of the household head substantially attenuates these effects, whereas similarity in partners’ risk preferences does not, pointing to self-confidence rather than altruistic preference aggregation as the primary mechanism underlying household portfolio choices.