IDEAS home Printed from https://ideas.repec.org/a/gam/jrisks/v9y2021i11p205-d676994.html
   My bibliography  Save this article

Value-Based Financial Risk Prediction Model

Author

Listed:
  • Jiří Pospíšil

    (Department of Christian Social Work, Sts Cyril and Methodius Faculty of Theology, Palacký University Olomouc, Na Hradě 5, 779 00 Olomouc, Czech Republic)

  • Nataša Matulayová

    (Department of Christian Social Work, Sts Cyril and Methodius Faculty of Theology, Palacký University Olomouc, Na Hradě 5, 779 00 Olomouc, Czech Republic)

  • Pavla Macháčková

    (Department of Christian Social Work, Sts Cyril and Methodius Faculty of Theology, Palacký University Olomouc, Na Hradě 5, 779 00 Olomouc, Czech Republic)

  • Pavlína Jurníčková

    (Department of Christian Social Work, Sts Cyril and Methodius Faculty of Theology, Palacký University Olomouc, Na Hradě 5, 779 00 Olomouc, Czech Republic)

  • Ivana Olecká

    (Department of Christian Social Work, Sts Cyril and Methodius Faculty of Theology, Palacký University Olomouc, Na Hradě 5, 779 00 Olomouc, Czech Republic)

  • Helena Pospíšilová

    (Department of Christian Social Work, Sts Cyril and Methodius Faculty of Theology, Palacký University Olomouc, Na Hradě 5, 779 00 Olomouc, Czech Republic)

Abstract

The model of financial risk prediction we developed and present in our paper is based on the theoretical assumption that there exists a significant relationship between actual economic situation and values. This assumption confirmed by the research influences the potential risk in financial behaviour and it becomes actual especially in the case of changing life conditions. The concept of the model is based on data received from 3768 respondents questioned across the Czech Republic. Measured variables were indexed, and the cluster and factor analyses were used for multivariate analysis. The model is unique in the combination of personal values projected into six generalized value types and developed economic indexes clustered in four types of economic situations. The primary purpose of the model is to identify the anticipated personal financial risk of clients. The model has fundamental applications as a diagnostic or auto-diagnostic tool in social work, counselling, psychotherapy, and other helping professions, or as a research instrument leading to various hypotheses and to the enhancement of theories concerning economic behaviour.

Suggested Citation

  • Jiří Pospíšil & Nataša Matulayová & Pavla Macháčková & Pavlína Jurníčková & Ivana Olecká & Helena Pospíšilová, 2021. "Value-Based Financial Risk Prediction Model," Risks, MDPI, vol. 9(11), pages 1-24, November.
    • Handle: RePEc:gam:jrisks:v:9:y:2021:i:11:p:205-:d:676994
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2227-9091/9/11/205/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2227-9091/9/11/205/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Mark Taylor, 2011. "Measuring Financial Capability and its Determinants Using Survey Data," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 102(2), pages 297-314, June.
    2. Arber, Sara & Fenn, Kirsty & Meadows, Robert, 2014. "Subjective financial well-being, income and health inequalities in mid and later life in Britain," Social Science & Medicine, Elsevier, vol. 100(C), pages 12-20.
    3. Annamaria Lusardi, 2012. "Numeracy, financial literacy, and financial decision-making," NBER Working Papers 17821, National Bureau of Economic Research, Inc.
    4. Richins, Marsha L, 1994. "Special Possessions and the Expression of Material Values," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 21(3), pages 522-533, December.
    5. Marjanovic, Zdravko & Greenglass, Esther R. & Fiksenbaum, Lisa & Bell, Chris M., 2013. "Psychometric evaluation of the Financial Threat Scale (FTS) in the context of the great recession," Journal of Economic Psychology, Elsevier, vol. 36(C), pages 1-10.
    6. Lu Fan, 2021. "A Conceptual Framework of Financial Advice-Seeking and Short- and Long-Term Financial Behaviors: An Age Comparison," Journal of Family and Economic Issues, Springer, vol. 42(1), pages 90-112, March.
    7. Angela Hung & Andrew Parker & Joanne K. Yoong, 2009. "Defining and Measuring Financial Literacy," Working Papers 708, RAND Corporation.
    8. M. Joseph Sirgy, 2018. "The Psychology of Material Well-Being," Applied Research in Quality of Life, Springer;International Society for Quality-of-Life Studies, vol. 13(2), pages 273-301, June.
    9. Angela A. Hung & Andrew M. Parker & Joanne K. Yoong, 2009. "Defining and Measuring Financial Literacy," Working Papers WR-708, RAND Corporation.
    10. Calvin Mudzingiri & John W. Muteba Mwamba & Jacobus Nicolaas Keyser, 2018. "Incentivized Time Preferences, Level of Education in a Household and Financial Literacy: Laboratory Evidence," Journal of Economics and Behavioral Studies, AMH International, vol. 10(2), pages 103-119.
    11. Richins, Marsha L & Dawson, Scott, 1992. "A Consumer Values Orientation for Materialism and Its Measurement: Scale Development and Validation," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 19(3), pages 303-316, December.
    12. Oliver Williams & Stephen Satchell, 2011. "Social welfare issues of financial literacy and their implications for regulation," Journal of Regulatory Economics, Springer, vol. 40(1), pages 1-40, August.
    13. Jing Xiao & Cheng Chen & Fuzhong Chen, 2014. "Consumer Financial Capability and Financial Satisfaction," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 118(1), pages 415-432, August.
    14. Ellen, Pam Scholder, 1994. "Do we know what we need to know? Objective and subjective knowledge effects on pro-ecological behaviors," Journal of Business Research, Elsevier, vol. 30(1), pages 43-52, May.
    15. W. Fred Raaij, 2016. "Understanding Consumer Financial Behavior," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-137-54425-4.
    16. Strömbäck, Camilla & Lind, Thérèse & Skagerlund, Kenny & Västfjäll, Daniel & Tinghög, Gustav, 2017. "Does self-control predict financial behavior and financial well-being?," Journal of Behavioral and Experimental Finance, Elsevier, vol. 14(C), pages 30-38.
    17. Thérèse Lind & Ali Ahmed & Kenny Skagerlund & Camilla Strömbäck & Daniel Västfjäll & Gustav Tinghög, 2020. "Competence, Confidence, and Gender: The Role of Objective and Subjective Financial Knowledge in Household Finance," Journal of Family and Economic Issues, Springer, vol. 41(4), pages 626-638, December.
    18. Kim, Jaehoon & Kim, Sangsin, 2015. "2012년 국회법 개정의 효과 연구 [A Study on the Effect of the 2012 National Assembly Act Amendment]," KDI Research Monographs, Korea Development Institute (KDI), volume 127, number v:2015-03(k):y:2015:p:1-1.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Steffen Westermann & Scott J. Niblock & Jennifer L. Harrison & Michael A. Kortt, 2020. "Financial Advice Seeking: A Review of the Barriers and Benefits," Economic Papers, The Economic Society of Australia, vol. 39(4), pages 367-388, December.
    2. Hyesun Hwang & Hyung In Park, 2023. "The relationships of financial literacy with both financial behavior and financial well‐being: Meta‐analyses based on the selective literature review," Journal of Consumer Affairs, Wiley Blackwell, vol. 57(1), pages 222-244, January.
    3. Tsun‐Feng Chiang, 2021. "Financial capability and investment management of Chinese households: An application of hybrid item response theory," Journal of Consumer Affairs, Wiley Blackwell, vol. 55(4), pages 1442-1463, December.
    4. Gentjan Çera & Khurram Ajaz Khan & Jaroslav Belas & Humberto Nuno Rito Ribeiro, 2020. "The Role of Financial Capability and Culture in Financial Satisfaction," Economic Papers, The Economic Society of Australia, vol. 39(4), pages 389-406, December.
    5. Oscar A. Stolper & Andreas Walter, 2017. "Financial literacy, financial advice, and financial behavior," Journal of Business Economics, Springer, vol. 87(5), pages 581-643, July.
    6. Sundar, B. & Virmani, Vineet, 2013. "Numeracy and Financial Literacy of Forest Dependent Communities Evidence from Andhra Pradesh," IIMA Working Papers WP2013-09-02, Indian Institute of Management Ahmedabad, Research and Publication Department.
    7. Davoli, Maddalena & Hou, Jia, 2018. "Financial literacy and socialist education: Lessons from the German reunification," SAFE Working Paper Series 217, Leibniz Institute for Financial Research SAFE.
    8. Korkmaz, Aslihan Gizem & Yin, Zhichao & Yue, Pengpeng & Zhou, Haigang, 2021. "Does financial literacy alleviate risk attitude and risk behavior inconsistency?," International Review of Economics & Finance, Elsevier, vol. 74(C), pages 293-310.
    9. Zaheer Ahmed & Umara Noreen & Suresh A.L. Ramakrishnan & Dewi Fariha Binti Abdullah, 2021. "What explains the investment decision-making behaviour? The role of financial literacy and financial risk tolerance," Afro-Asian Journal of Finance and Accounting, Inderscience Enterprises Ltd, vol. 11(1), pages 1-19.
    10. Jiří Pospíšil & Ivana Olecká & Nataša Matulayová & Helena Pospíšilová & Pavlína Jurníčková & Pavla Macháčková, 2022. "Who Are the People at Socio-Economic Risk? Socio-Demographical Analysis of the Czech People in Specific Economical Situations Recognized in Value-Based Risk Prediction Model," Social Sciences, MDPI, vol. 11(5), pages 1-15, May.
    11. Tomasz Potocki & Sylwester Białowąs, 2023. "What Factors Predict a Positive Change in a Consumer’s Financial Capability over Time? The New Evidence from Poland," Journal of Family and Economic Issues, Springer, vol. 44(3), pages 634-654, September.
    12. Rodrigues, Luís Filipe & Oliveira, Abílio & Rodrigues, Helena & Costa, Carlos J., 2019. "Assessing consumer literacy on financial complex products," Journal of Behavioral and Experimental Finance, Elsevier, vol. 22(C), pages 93-104.
    13. Li, Xiao, 2020. "When financial literacy meets textual analysis: A conceptual review," Journal of Behavioral and Experimental Finance, Elsevier, vol. 28(C).
    14. Khanh Duy Pham & Vu Linh Toan Le, 2023. "Nexus between Financial Education, Literacy, and Financial Behavior: Insights from Vietnamese Young Generations," Sustainability, MDPI, vol. 15(20), pages 1-21, October.
    15. Almenberg, Johan & Dreber, Anna, 2015. "Gender, stock market participation and financial literacy," Economics Letters, Elsevier, vol. 137(C), pages 140-142.
    16. Muñoz-Murillo, Melisa & Álvarez-Franco, Pilar B. & Restrepo-Tobón, Diego A., 2020. "The role of cognitive abilities on financial literacy: New experimental evidence," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 84(C).
    17. Travis P. Mountain & Namhoon Kim & Joyce Serido & Soyeon Shim, 2021. "Does Type of Financial Learning Matter for Young Adults’ Objective Financial Knowledge and Financial Behaviors? A Longitudinal and Mediation Analysis," Journal of Family and Economic Issues, Springer, vol. 42(1), pages 113-132, March.
    18. Börsch-Supan, Axel & Bucher-Koenen, Tabea & Hurd, Michael D. & Rohwedder, Susann, 2023. "Saving regret and procrastination," Journal of Economic Psychology, Elsevier, vol. 94(C).
    19. Vineetha Mathew & Santhosh Kumar P K & Sanjeev M A, 2024. "Financial Well-being and Its Psychological Determinants— An Emerging Country Perspective," FIIB Business Review, , vol. 13(1), pages 42-55, January.
    20. Andrzej Cwynar & Wiktor Cwynar & Monika Baryła-Matejczuk & Moises Betancort, 2019. "Sustainable Debt Behaviour and Well-Being of Young Adults: The Role of Parental Financial Socialisation Process," Sustainability, MDPI, vol. 11(24), pages 1-26, December.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jrisks:v:9:y:2021:i:11:p:205-:d:676994. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.