Natural Disasters and Household Participation in Financial Assets: Evidence From China
研究中国自然灾害经历如何降低家庭参与股票、基金等风险资产的可能性和投资额，主要通过增加财务困境和降低风险容忍度实现，且高流动性家庭和汉族家庭受影响更大。
ABSTRACT This paper examines the impact of natural disaster experience on household participation in financial assets in China. Our findings show that exposure to natural disasters significantly reduces both the likelihood and investment level in risky financial assets, including stocks, mutual funds and wealth management products, whereas participation in low‐risk assets such as savings remains largely unaffected. Further analysis identifies increased household financial distress and reduced risk tolerance as the primary channels through which disaster experience affects financial behaviour. Heterogeneity analyses reveal that the negative impact on stock and mutual fund participation is more pronounced among households with higher liquidity and those of Han ethnicity. Moreover, the decline in mutual fund participation is stronger among households with weaker social networks, suggesting that social capital may play a buffering role in mitigating disaster‐induced risk aversion.