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Financial literacy's effect on elicited subjective discount rate

Author

Listed:
  • Eyal Lahav

    (The School of Business Administration, The College of Management Academic Studies, Israel)

  • Mosi Rosenboim

    (The Faculty of Business Administration, Ben-Gurion University of the Negev, Israel)

  • Tal Shavit

    (The School of Business Administration, The College of Management Academic Studies, Israel)

Abstract

Financial illiteracy is a well-known, international problem. The current study investigates if learning basic fundamentals of cash flow capitalization affects time preference. The findings indicate that this knowledge does dramatically decrease preference for the present.

Suggested Citation

  • Eyal Lahav & Mosi Rosenboim & Tal Shavit, 2015. "Financial literacy's effect on elicited subjective discount rate," Economics Bulletin, AccessEcon, vol. 35(2), pages 1360-1368.
    • Handle: RePEc:ebl:ecbull:eb-15-00162
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Beatrice Magistro, 2020. "Financial literacy and support for free trade in the UK," The World Economy, Wiley Blackwell, vol. 43(8), pages 2050-2069, August.
    2. Lahav, Eyal & Shavit, Tal & Benzion, Uri, 2016. "Can't wait to celebrate: Holiday euphoria, impulsive behavior and time preference," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 65(C), pages 128-134.
    3. Israel, Avi & Rosenboim, Mosi & Shavit, Tal, 2022. "The effect of SMS notifications on time preferences," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 97(C).
    4. Paraboni, Ana Luiza & da Costa, Newton, 2021. "Improving the level of financial literacy and the influence of the cognitive ability in this process," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 90(C).
    5. Corneille, O. & D’Hondt, C. & De Winne, R. & Efendic, E. & Todorovic, A., 2021. "What leads people to tolerate negative interest rates on their savings?," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 93(C).
    6. Beatrice Magistro, 2022. "The influence of financial and economic literacy on policy preferences in Italy," Economics and Politics, Wiley Blackwell, vol. 34(2), pages 351-381, July.
    7. Koppenberg, Maximilian & Spiegel, Alisa, 2017. "Farm-level investment analysis: what discount rate to use?," 57th Annual Conference, Weihenstephan, Germany, September 13-15, 2017 262167, German Association of Agricultural Economists (GEWISOLA).

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    More about this item

    Keywords

    Time preference; Financial Literacy; Subjective discount rate;
    All these keywords.

    JEL classification:

    • D9 - Microeconomics - - Micro-Based Behavioral Economics

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