Why do financial literacy programmes fail?

Date
2013-03-31
Authors
Frijns, BPM
Gilbert, A
Tourani-Rad, A
Supervisor
Item type
Journal Article
Degree name
Journal Title
Journal ISSN
Volume Title
Publisher
Auckland Centre for Financial Research, Auckland University of Technology
Abstract

Numerous studies have found a positive relationship between financial literacy and financial experience. Typically, this relationship is interpreted as being a causal relationship, i.e. an increase in financial literacy leads to better financial decision making. However, a simple relationship cannot be interpreted in a causal way. In this paper, we show evidence for a causal relationship running the opposite way, i.e. people with more financial experience seem to acquire more financial knowledge and become more financially literate. This finding has important implications as it suggests that programmes targeted at improving financial literacy could be more effective if they incorporate experiential components.

Description
Keywords
Financial literacy , Financial experience, Causality
Source
Applied Finance Letters, vol.2(1), pp.18 - 21 (4)
DOI
Rights statement
By publishing in Applied Finance Letters, the author(s) agree to the dissemination of their work through Applied Finance Letters. However, authors are free to use their published work in any way or form in future publications.