International Journal of Accounting and Taxation

The Model of Stock Market Participation with an Emphasis on Cultural and Social Factors: A Grounded Theory Approach
Sadegh Rahimi, Khosro Faghani makarani, Ali Zabihi

Abstract
The purpose of this study was to present a model of stock market participation with an emphasis on cultural and social factors. Given that to date, there has not been any realized stock market participation model developed with social and culture considerations; therefore, there are no realized cases to be studied as a part of this paper‟s research methodology. hence grounded theory is applied to propose a consistent framework. The results of the study showed that the cultural and social factors play an important role in stock market participation. factors like power distance index, uncertainty avoidance index, individualism vs. Collectivism, risk aversion, belief and attitude, self confidence, optimism, social interaction, group membership, family, peer group, internet, learning from others, word of mouth communication with others and herding behavior. The results also showed that expanding financial literacy, increase the transparency of financial markets, government protection of shareholders, increase public awareness about the stock market, reduce entry and transaction costs in the stock market, are the most important strategies, which can be employed to increase stock market participation. This paper also discusses the applicability and implications of this new framework for future research.

Full Text: PDF     DOI: 10.15640/ijat.v8n1a7