Home Bias, an Academic Puzzle. (29th March 2016)

• Record Type: Journal Article
• Authors: Andrew Karolyi, G.
• Is Part Of: Review of finance. Volume 20:Number 6(2016)
• Page Start: 2049
• Page End: 2078
• Publication Date: 2016-03-29
• Subjects: G10 -- F60 -- A14; Finance -- Europe -- Periodicals; Financiën; Finance; Periodicals; 332.09405
• DOI: 10.1093/rof/rfw007
• Languages: English
• ISSNs: 1572-3097

Abstract

Abstract : Only 16% (23%) of all empirical studies published in the top four (fourteen) Finance journals examine non-US markets, a fraction that is well below measures reflecting their economic importance. This "home bias" measure fluctuates across years with a weakly declining trend. There is also a "foreign bias" in which some non-US countries are more frequently the subject of published papers than others. I am able to explain only a small fraction of either the home-bias or the foreign-bias puzzles. Surprisingly, there are on average 2.01 higher annual cumulative citations per non-US paper published relative to cohort-matched US-focused papers.