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Subjective Belief Distributions and the Characterization of Economic Literacy

Author

Listed:
  • Di Girolamo, Amalia

    () (University of Birmingham)

  • Harrison, Glenn

    () (Georgia State University, CEAR)

  • Lau, Morten

    () (Copenhagen Business School)

  • Swarthout, J. Todd

    () (Georgia State University)

Abstract

We characterize the literacy of an individual in a domain by their elicited subjective belief distribution over the possible responses to a question posed in that domain. By eliciting the distribution, rather than just the answers to true/false or multiple choice questions, we can directly measure the confidence that an individual has about their knowledge of some fact. We consider literacy across several financial and economic domains. We find considerable demographic heterogeneity in the degree of literacy. We also measure the degree of consistency within a sample about their knowledge, even when that knowledge is imperfect.

Suggested Citation

  • Di Girolamo, Amalia & Harrison, Glenn & Lau, Morten & Swarthout, J. Todd, 2016. "Subjective Belief Distributions and the Characterization of Economic Literacy," IZA Discussion Papers 9856, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp9856
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    References listed on IDEAS

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    Keywords

    subjective beliefs; economic literacy;

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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