Dear Carl. Human beings are human beings. It does not matter whether you are from developed, less developed or under-developed economies. We all possess the same human nature. What would make you posit that human beings say, in the US are any different from human beings in say Calcutta? What brings about the difference is the level of sophistication of the markets in these different places. The systems are the ones which impact on behaviour, not human beings themselves per se. Again, I am not sure whether there is anything "special" in emerging economies to make investors overconfident - I am narrating this without deliberately looking at available literature on this subject. I deliberately decided to give my "uncensored" response because sometimes we carry out studies without deeply thinking about what we intend to study. In summary, my take is, study the systems in these emerging economies and compare with those in developed economies, see if there is a difference - However, the answer to what I am suggesting is: "there is an obvious difference". So, this begs the question - what do you really want to investigate?

But humans have different cultures and behaviour can be shaped by that culture.  

Carl, that is why I mentioned "systems". That is what influences human behaviour, not because of their domicile. Humans are humans. I am a staunch critic of behavioural finance/accounting because some of the concepts examined are flawed and this needs to change. Unless you argue a case of information flows in developed/emerging economies, studying human behaviour on itself may not be informed. 

Also do not underscore the heterogeneity in investors, infact, some of the investors who invest in emerging economies are from those developed economies. How would you get to discriminate those investors from emerging economies and investing in emerging economies and foreign investors investing in emerging economies....just some food for thought. My main issue is arguing that investor behaviour may be shaped by where investors are domiciled - the emerging economy/developed economy story...

There is a large body of research on behavioural finance. I am not making any value judgements about emerging markets. I am simply trying to find out if there are any papers investigating behavioural finance in emerging markets and how do the results compare to developing markets. We investigate a whole range of differences between emerging and developed markets.

David, why would we not expect cross country differences in investment attitudes?

Volatility is high in emerging markets like India. But this could be more due to lack of depth in the market, and possible rigging in small and mid-cap shares by some players. Some gullible individual players might get carried away at such times and burn their fingers. If the market depth is more and there are large number of institutional players the volatility might come down..Sebi is trying to do its best to reduce rigging.

I know of one paper that explicitly looks at this question with data from Turkey:

Tekce, Yilmaz (2015) - Are individual stock investors overconfident? Evidence from

an emerging market

It's published in the journal of behavioral and experimental finance.

Thank you

HI,

You may find some ideas in this paper:

Momentum, Reversals, and Fund Manager Overconfidence

Financial management Fall 2016, vol 45 issue 3, (pages 609–639)

Biljana N. Adebambo and Xuemin (Sterling) Yan

Best regards