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Record W2789390553 · doi:10.3390/jrfm18100577

External Habit Persistence and Individual Portfolio Choice

2025· article· en· W2789390553 on OpenAlexvenueno aff
Timothy K. Chue

Bibliographic record

VenueJournal of risk and financial management · 2025
Typearticle
Languageen
FieldDecision Sciences
TopicDecision-Making and Behavioral Economics
Canadian institutionsnot available
Fundersnot available
KeywordsPersistence (discontinuity)PortfolioHabitEconomicsPsychologySocial psychologyFinancial economicsEngineering

Abstract

fetched live from OpenAlex

This paper shows that a common form of external habit persistence, despite having much success in asset pricing, implies an extreme degree of conformity in investors’ portfolio choice. If an investor with this utility function uses US aggregate consumption as her external habit benchmark, she has to hold all non-redundant securities contained in the US aggregate wealth portfolio. Even for an investor who uses the average consumption of a more narrowly-defined community as her benchmark, she is still required to hold non-zero positions in all (non-redundant) individual stocks held by any other member of the community. If markets are incomplete, even if an individual investor holds a financial portfolio that conforms perfectly with that associated with the external habit benchmark, it is still impossible for the investor to ensure that consumption exceeds habit in all states of the world. Because of this implication, this form of external habit is unlikely to describe the preferences of individual investors—notwithstanding its success as a model for the representative agent in asset pricing.

Fetched live from OpenAlex and de-inverted. Abstracts are not stored in this database: the inverted indexes are 8.6 GB of the frame’s 9.3 GB of text, and the host has 13 GB free.

How this classification was reachedexpand

Full frame machine prediction

Teacher imitation

Not calibrated prevalence, not ground truth. Human validation pending. The Gemma side is a direct model label for every work in the frame, read from the title-only record. The Codex side is a classifier learned from the 10,348 direct Codex labels and calibrated to design-weighted sample rates; fields without enough sample support carry no Codex call. Candidate is the union of the two sides; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels.

metaresearch head score (Codex)0.002
metaresearch head score (Gemma)0.009
Version: metacan-v3-hybrid-931329e0061cValidation status: machine_predicted_unvalidated
Candidate categoriesnone
Consensus categoriesnone
DomainCandidate signal: none · Consensus signal: none
Study designCandidate signal: Theoretical or conceptual · Consensus signal: Theoretical or conceptual
GenreCandidate signal: Empirical · Consensus signal: Empirical
Teacher disagreement score0.003
Threshold uncertainty score0.010

Distilled classifier scores by category (both heads)

CategoryCodexGemma
Metaresearch0.0020.009
Meta-epidemiology (narrow)0.0000.000
Meta-epidemiology (broad)0.0000.000
Bibliometrics0.0000.000
Science and technology studies0.0000.001
Scholarly communication0.0010.002
Open science0.0000.001
Research integrity0.0010.001
Insufficient payload (model declined to judge)0.0030.000

Machine scores (provisional)

The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.

Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.

Opus teacher head0.058
GPT teacher head0.331
Teacher spread0.273 · how far apart the two teachers sit on this one work
Validation statusscore_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from it

Classification

machine, unvalidated

Machine predicted; a candidate call from one source (direct Gemma or distilled Codex), not a consensus.

The models applied no category: nothing in the taxonomy fit this work.
Study designTheoretical or conceptual
Domainnot available
GenreEmpirical

How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".

Quick stats

Citations0
Published2025
Admission routes1
Has abstractyes

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