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Financial Literacy, Cultural Dominance, and Financial Well‐Being of SME Owners in Ghana

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  • Samuel K. Agyei
  • Anokye M. Adam
  • Otuo S. Agyemang

Abstract

The literature on the relationship between financial literacy and financial well‐being is growing but yet to consider whether the social support emanating from cultural settings conditions this relationship. The main objective of this article was to assess the role cultural values (Protestantism and Catholicism) played in explaining the financial well‐being of small‐ and medium‐scale enterprise (SME) owners in a developing economy, Ghana. On the basis of 300 randomly selected SME owners, an ordinary least squares technique was employed to establish this relationship. The results highlight that the level of financial literacy of SME owners tends to influence their financial well‐being. In addition, Protestant ideology weakens financial wealth acquisition process of SME‐Owners. Lastly, the study found little support for the assertion that culture moderates the relationship between financial literacy and financial well‐being. Consequently, the study recommended that policies aimed at promoting financial education for financial well‐being should not neglect the cultural context of beneficiaries. 研究金融素养与财务状况关系的文献越来越多，但目前还没有研究考量由文化背景产生的社会支持是否会影响这种关系。本文主要目标是评估文化价值（新教与天主教）在解释加纳这一发展中经济体的中小型企业所有人（SME‐owners）财务状况一事上发挥的作用。基于随机选择的300位中小型企业所有人，应用了普通最小二乘法建立该关系。研究结果显示，中小型企业所有人的金融素养程度往往会影响其财务状况。此外，既掌握金融知识，同时又是新教徒的中小型企业所有人往往不会提高其财务状况。最后，本研究并未发现证据证明，文化能缓和金融素养与财务状况关系这一论断。因此，本研究建议，那些旨在为财务状况推动金融教育的政策不应忽视受益人的文化背景。 La literatura sobre la relación entre la educación financiera y el bienestar financiero está creciendo, pero aún para considerar si el apoyo social que emana de los entornos culturales condiciona esta relación. El objetivo principal de este trabajo fue evaluar el papel que desempeñaban los valores culturales (protestantismo y catolicismo) en la explicación del bienestar financiero de los propietarios de pequeñas y medianas empresas en una economía en desarrollo, Ghana. Sobre la base de 300 propietarios de PYME seleccionados al azar, se empleó una técnica de mínimos cuadrados ordinarios para establecer esta relación. Los resultados destacan que el nivel de educación financiera de los propietarios de PYME tiende a influir en su bienestar financiero. Además, los propietarios de PYME con conocimientos financieros que son protestantes tienden a no mejorar su bienestar financiero. Por último, el estudio no encontró apoyo para la afirmación de que la cultura modera la relación entre la educación financiera y el bienestar financiero. En consecuencia, el estudio recomendó que las políticas destinadas a promover la educación financiera para el bienestar financiero no deben descuidar el contexto cultural de los beneficiarios.

Suggested Citation

  • Samuel K. Agyei & Anokye M. Adam & Otuo S. Agyemang, 2019. "Financial Literacy, Cultural Dominance, and Financial Well‐Being of SME Owners in Ghana," Poverty & Public Policy, John Wiley & Sons, vol. 11(3), pages 222-237, September.
    • Handle: RePEc:wly:povpop:v:11:y:2019:i:3:p:222-237
    DOI: 10.1002/pop4.254
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