Hyper-Segmentation and Exclusion in Financial Services in the U.S.

Abstract

The last twenty years has been a period of major structural change for the financial services sector in the United States. Some of this restructuring has been prompted by technological change, but public policy has actively facilitated the increased mobility of capital to places where it brings the highest short-term private return but not necessarily the greatest long-term social return. While deregulation and technology have combined to provide a wider choice of services and increased price pressure in the lucrative segments of different financial markets, the pursuit of affluent customers has left lower-income consumers and very small firms at a disadvantage. The sector overall has moved toward a hyper-segmentation of customer bases by income and race, leaving many communities served primarily by higher-cost and sometimes abusive financial services firms.     

Agenda-building in the corporate sphere: Analyzing influence in the 2008 Yahoo!-Icahn proxy contest

This study further extends agenda-building theory into the corporate sphere. This investigation tested for agenda-building relationships between the issues emphasized in corporate candidate-controlled information subsidies and financial news media coverage during the 2008 Yahoo! Inc.-Carl Icahn proxy contest for control of Yahoo!’s board of directors. Solid support was found for issue agenda-building associations. Cross-lagged correlation analyses revealed that both Yahoo!’s and Icahn's information subsidies enjoyed some success in shaping media coverage during the proxy fight. The theoretical and practical implications of these findings are discussed.     

Teaching children to save: What is the best strategy for lifetime savings?

We study the effect of alternative parental teaching strategies on the propensity to save and the amount saved during adulthood. Using a panel dataset from the Dutch DNB Household Survey we find that parental teaching to save increases the likelihood that an adult will save by 16%, and the saving amount by about 30%. The best strategy involves a combination of different methods (giving pocket money, controlling money usage, and giving advice about saving and budgeting). The effect of parental financial socialization is persistent with age, but decays at elder age for the propensity to save.     

Between trust and distrust in research with participants in conflict context

Trust is often treated as a binary where research participants either trust researchers or not, whereas in reality trust is multi-layered. Drawing on 10 months of fieldwork working with internally displaced persons and their non-displaced neighbours in rural Colombia, this article provides a more nuanced discussion of trust in research. It identifies ways in which participants are vulnerable, provides fieldwork strategies to address these vulnerabilities, and questions the assumption that extended time spent in the field necessarily results in greater trust. It argues that such beliefs underestimate the complexity of conflict and post-conflict research contexts where political and social relations are often unstable. Demonstrating that trust may be compartmentalised, and that trust and distrust can coexist, it proposes that the question researchers should ask themselves is not whether participants trust us or not but rather in what capacity and to what degree they (dis)trust us and what influences their level of trust.     

The significance of financial self-efficacy in explaining women’s personal finance behaviour

Much policy attention has been placed on enhancing individuals’ financial knowledge and literacy, chiefly through financial education programs. However, managing one’s personal finances takes more than financial knowledge and literacy: an individual also needs a sense of self-assuredness, or ‘self-belief’, in their own capabilities. This personal attribute is known within the psychology literature as ‘self-efficacy’. This paper examines the significance of an individual’s financial self-efficacy in explaining their personal finance behaviour, through the application of a psychometric instrument. Using a 2013 survey of Australian women, financial self-efficacy emerges as one of the strongest predictors of the type and number of financial products that a woman holds. Specifically, our analysis reveals that women with higher financial self-efficacy – that is, with greater self-assuredness in their financial management capacities – are more likely to hold investment and savings products, and less likely to hold debt-related products. Even alongside other important factors – such as education, financial risk preferences, age and household income – the explanatory power of financial self-efficacy is found to be significant at the 1% critical level. Moreover, the significance of financial self-efficacy is independently identified from that of financial literacy factors, which bears important implications for the development of policies aiming to improve financial outcomes.     

Organizing insecurity: marginal subjects and narratives of injustice

In order to understand how insecurity is organized, we draw from our conversations with marginal workers from a variety of contexts in India – Tamil and Tibetan refugees, informal sector workers, contract or temporary workers and organized sector workers with apparently stable contracts. We theorize insecurity as the experience of injustice, and the structuring of inequalities to which workers are forced to give muted consent. We also read insecurity as the production of sovereignties in which the nation, state and the corporation intersect to produce regimes of injustice. Finally, we read insecurity as the abduction of the subject of the worker, and her conversion into a resource from whom value is extracted. Perhaps, the hope of resistance lies in the politics of vulnerability, a politics which undoes the subordinations and the violence of contracts.     

The shadow of the past: Financial risk taking and negative life events

Based on data from the four 2004–2010 waves of the US Health and Retirement Study (HRS), we show that financial risk taking is significantly related to life-history negative events out of an individual’s control. Using observed portfolio decisions to proxy for risk taking, we find correlation with two of such individual-specific events: having been victim of a physical attack and (especially) the loss of a child are associated with lower and less frequent investments in risky assets, with an intensity similar to that of the beginning, in 2008, of a collectively experienced event such as the recent financial crisis. We also find evidence that the correlation of risk taking with a child loss is long-lasting, as opposed to the correlation with a physical attack that disappears after few years. Our analysis is more in favor of a preference-based – rather than a belief-based – explanation of the observed change in risk taking. Overall our findings indicate that the past, especially through the loss of a child, casts a long shadow that extends over individuals’ current decisions also within unrelated domains.     

Field Placement and the Impact of Financial Stress on Social Work and Human Service Students

While significant research has been undertaken exploring the pedagogical benefits of undertaking lengthy social work and human services field placements, there has been very little consideration given to the potential financial stress involved for students. This study sought to address this knowledge gap. Research was conducted in 2014 using quantitative and qualitative methods with students and academic and professional staff from six Queensland universities. The findings show a significant relationship between unpaid placements and financial hardship, creating considerable stress for students and at times a compromised placement learning experience. The limited flexibility in requirements from professional bodies and universities for how placements are undertaken has been identified as a key contributor to financial hardship. Addressing the complexities inherent in this issue requires a collaborative effort from multiple stakeholders and should not be regarded as a problem for students to endure and manage.     

Financial Exploitation of Older Persons

Abstract

Financial exploitation is a recognized social problem of unknown, though likely increasing, magnitude. It can occur through numerous methods, including the misuse of powers of attorney and guardianship, illegal transfers of property, and outright fraud and theft. Financial crimes against older persons are difficult to address because they often go unreported. This paper provides a summary of findings from a study of financial exploitation of older persons. We review what is known about the nature and scope of financial exploitation of older persons and describe barriers to addressing the problem. We also identify gaps in knowledge, discuss current methods for addressing financial exploitation, and provide recommendations and suggested policy approaches for prevention and remediation.     

Promoting Resilient Livelihoods through Adaptive Social Protection: Lessons from 124 programmes in South Asia

Adaptive Social Protection refers to efforts to integrate social protection (SP), disaster risk reduction (DRR) and climate change adaptation (CCA), the need for which is increasingly recognised by practitioners and academics. Relying on 124 agricultural programmes implemented in five countries in Asia, this article considers how these elements are being brought together, and explores the potential gains of these linkages. It shows that full integration is still relatively limited but that, when it occurs, it helps to shift the time horizon beyond short‐term interventions aimed at supporting peoples' coping strategies and/or graduation objectives, towards longer‐term interventions that can help promote transformation towards climate and disaster resilient livelihood options.