Exploring the effect of financial literacy courses on student achievement: a cross-country approach using PISA 2012 data

The aim of this research is to explore whether the deployment of specialized courses on basic financial concepts at schools has a significant impact on how able students are to apply the knowledge and skills that they learn to real-life situations involving financial issues and decision making. To do this, we exploit the rich set of comparative data about the countries participating in the PISA 2012 financial literacy assessment. This includes 18 of the 70 countries participating in this wave of PISA. Our empirical analysis is based on a difference-in-differences approach comparing the results of the same students across two subjects (financial literacy and reading). We assume that the distribution of students across schools does not depend on the provision of financial education. Thus we can estimate the effect of the treatment as the difference between the performance of students at schools that offer or do not offer financial education courses. Our results suggest that such courses have a significant and positive effect on student achievement regardless of the strategy applied to teach financial concepts.