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Childhood roots of financial literacy

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  • Grohmann, Antonia
  • Kouwenberg, Roy
  • Menkhoff, Lukas

Abstract

Financial literacy predicts informed financial decisions, but what explains financial literacy? We use the concept of financial socialization and aim to represent three major agents of financial socialization: family, school and work. Thus we compile twelve relevant childhood characteristics in a new survey study and examine their relation to financial literacy, while controlling for established socio-demographic characteristics. We find in a mediation analysis that both family and school positively affect the financial literacy of adults. Moreover, financial literacy and school related variables also have a direct effect on financial behavior. This suggests that family factors and schooling work through complementary channels.

Suggested Citation

  • Grohmann, Antonia & Kouwenberg, Roy & Menkhoff, Lukas, 2015. "Childhood roots of financial literacy," Journal of Economic Psychology, Elsevier, vol. 51(C), pages 114-133.
    • Handle: RePEc:eee:joepsy:v:51:y:2015:i:c:p:114-133
    DOI: 10.1016/j.joep.2015.09.002
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    More about this item

    Keywords

    Financial literacy; Financial behavior; Family background; Education; Numeracy;
    All these keywords.

    JEL classification:

    • D - Microeconomics
    • G - Financial Economics
    • I - Health, Education, and Welfare

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