June 1, 2010
This dissertation investigates the effect of stock market participation on political behavior. Some observers claim that financial assets—stocks and mutual funds—have a causal effect on political behavior. The “investor class theory” asserts that as people invest in the stock market their partisan attachments shift rightward. The “asset effect theory” claims that financial investments increase political interest and participation. I examine these claims with longitudinal data from the United States and Great Britain covering a twenty-year period from the early 1980s through the mid-2000’s. I also examine the effect of financial asset ownership on political attitudes in the United States during the 2008 stock market crash. I find no evidence to support the argument that stock market participation has any causal effect on partisanship, participation, or political attitudes.