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What Does Financial Literacy Training Teach Us?

Author Info

Listed author(s):
  • Bruce Ian Carlin
  • David T. Robinson

Abstract

The authors use data from a finance-related theme park to explore how financial education changes investment, financing, and consumer behavior. Students were assigned fictitious life situations and asked to create household budgets. Some students received a 19-hour financial literacy curriculum before going to the park, and some did not. After controlling for demographic variables, the authors show that the treatment effects of the financial literacy program are strong. Students were more frugal, delayed gratification, paid off debt faster, and relied less on credit financing after training. Students who attended training showed greater uptake of decision support that was offered in the park, which indicates that decision support and financial literacy training are complements, not substitutes.

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File URL: http://hdl.handle.net/10.1080/00220485.2012.686385
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Article provided by Taylor & Francis Journals in its journal The Journal of Economic Education.

Volume (Year): 43 (2012)
Issue (Month): 3 (July)
Pages: 235-247

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Handle: RePEc:taf:jeduce:v:43:y:2012:i:3:p:235-247
DOI: 10.1080/00220485.2012.686385
Contact details of provider: Web page: http://www.tandfonline.com/VECE20

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Find related papers by JEL classification:
  • A21 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - Pre-college
  • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
  • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education

References listed on IDEAS
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  1. Annamaria Lusardi & Olivia S. Mitchell & Vilsa Curto, 2009. "Financial Literacy among the Young," Working Papers wp191, University of Michigan, Michigan Retirement Research Center.
  2. Annamaria Lusardi & Olivia S Mitchelli, 2007. "Financial Literacy and Retirement Preparedness: Evidence and Implications for Financial Education," Business Economics, Palgrave Macmillan;National Association for Business Economics, vol. 42(1), pages 35-44, January.
  3. James J. Choi & David Laibson & Brigitte C. Madrian & Andrew Metrick, 2001. "Defined Contribution Pensions: Plan Rules, Participant Decisions, and the Path of Least Resistance," NBER Working Papers 8655, National Bureau of Economic Research, Inc.
  4. Annamaria Lusardi, 2007. "Household Saving Behavior: The Role of Literacy, Information and Financial Education Programs," CeRP Working Papers 65, Center for Research on Pensions and Welfare Policies, Turin (Italy).
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Cited by:

  1. B. Ronchini, 2015. "Il ruolo emergente dell'edutainment nei percorsi di educazione finanziaria," Economics Department Working Papers 2015-EF03, Department of Economics, Parma University (Italy).
  2. Leonardo Becchetti & Fabio Pisani, 2011. "Financial education on secondary school students: the randomized experiment revisited," Econometica Working Papers wp34, Econometica.
  3. Berry, James & Karlan, Dean S. & Pradhan, Menno, 2015. "The Impact of Financial Education for Youth in Ghana," CEPR Discussion Papers 10529, C.E.P.R. Discussion Papers.
  4. Joanne W. Hsu, 2011. "Aging and Strategic Learning: The Impact of Spousal Incentives on Financial Literacy," NFI Working Papers 2011-WP-06, Indiana State University, Scott College of Business, Networks Financial Institute.
  5. Lührmann, Melanie & Serra-Garcia, Marta & Winter, Joachim, 2015. "Teaching teenagers in finance: Does it work?," Journal of Banking & Finance, Elsevier, vol. 54(C), pages 160-174.
  6. Bruce I. Carlin & Li Jiang & Stephen A. Spiller, 2014. "Learning Millennial-Style," NBER Working Papers 20268, National Bureau of Economic Research, Inc.
  7. Francka Lovšin Kozina & Nina Ponikvar, 2015. "Financial Literacy of First-Year University Students: The Role of Education," International Journal of Management, Knowledge and Learning, International School for Social and Business Studies, Celje, Slovenia, vol. 4(2), pages 241-255.
  8. repec:spr:jbecon:v:87:y:2017:i:5:d:10.1007_s11573-017-0853-9 is not listed on IDEAS
  9. Carman, Katherine Grace & Zamarro, Gema, 0. "Does Financial Literacy Contribute To Food Security?," International Journal of Food and Agricultural Economics (IJFAEC), Alanya Alaaddin Keykubat University, Department of Economics and Finance, vol. 4.
  10. Coda Moscarola, Flavia & Migheli, Matteo, 2015. "Educating Children to Save: an Experimental Approach to Financial Education of Pupils in Primary Schools," Department of Economics and Statistics Cognetti de Martiis. Working Papers 201502, University of Turin.
  11. Winter, Joachim & Lührmann, Melanie & Serra Garcia, Marta, 2013. "The effects of financial literacy training: Evidence from a field experiment in German high schools," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79744, Verein für Socialpolitik / German Economic Association.
  12. Singh, Ardhendu & Venkataramani, Bhama, 2012. "Financial Education: Institutes of Higher Education as delivery channels," MPRA Paper 43336, University Library of Munich, Germany.
  13. Joanne W. Hsu, 2011. "Aging and strategic learning: the impact of spousal incentives on financial literacy," Finance and Economics Discussion Series 2011-53, Board of Governors of the Federal Reserve System (U.S.).

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