nep-fle New Economics Papers
on Financial Literacy and Education
Issue of 2020‒06‒08
five papers chosen by

  1. Financial Education Affects Financial Knowledge and Downstream Behaviors By Kaiser, Tim; Lusardi, Annamaria; Menkhoff, Lukas; Urban, Carly
  2. Measuring Financial Access; 10 Years of the IMF Financial Access Survey By Marco A Espinosa-Vega; Kazuko Shirono; Hector Carcel Villanova; Esha Chhabra; Bidisha Das; Yingjie Fan
  3. Drivers of Credit Penetration in Eastern India By Rajesh, Raj; Das, Anwesha
  4. Working Paper 323- Mobile Financial and Banking Services Development in Africa By Christian Lambert Nguena
  5. Working Paper 317 - Women Self-Selection out of the Credit Market in Africa By Hanan Morsy; Amira El-Shal; Andinet Woldemichael

  1. By: Kaiser, Tim (DIW Berlin); Lusardi, Annamaria (Dartmouth College); Menkhoff, Lukas (Leibniz University of Hannover); Urban, Carly (Montana State University)
    Abstract: We study the rapidly growing literature on the causal effects of financial education programs in a meta-analysis of 76 randomized experiments with a total sample size of over 160,000 individuals. The evidence shows that financial education programs have, on average, positive causal treatment effects on financial knowledge and downstream financial behaviors. Treatment effects are economically meaningful in size, similar to those realized by educational interventions in other domains and are at least three times as large as the average effect documented in earlier work. These results are robust to the method used, restricting the sample to papers published in top economics journals, including only studies with adequate power, and accounting for publication selection bias in the literature. We conclude with a discussion of the cost-effectiveness of financial education interventions.
    Keywords: financial literacy, financial education, financial behavior, RCT, metaanalysis
    JEL: D14 I21
    Date: 2020–04
  2. By: Marco A Espinosa-Vega; Kazuko Shirono; Hector Carcel Villanova; Esha Chhabra; Bidisha Das; Yingjie Fan
    Abstract: This departmental paper marks the 10th anniversary of the IMF Financial Access Survey (FAS). It offers a retrospective of the FAS database, along with some reflections as to its future directions. Since its 2009 launch, the FAS has provided granular data on access to and use of financial services. It is a supply-side database with annual global coverage based on data sourced directly from financial service providers—aimed at supporting policymakers to target and evaluate financial inclusion policies. Its data collection has kept pace with financial innovation, such as the rise of mobile money and growing demand for gender-disaggregated data—and the FAS must continue to evolve.
    Keywords: Financial inclusion;Financial institutions;Inclusive growth;Economic development;Financial inclusion;Financial institutions;Inclusive growth;Economic development
    Date: 2020–05–12
  3. By: Rajesh, Raj; Das, Anwesha
    Abstract: This article highlights that the eastern region of India continues to lag behind other regions in harnessing the potential of bank credit as an instrument to promote growth and development, notwithstanding concerted policy efforts to further financial inclusion in the region. While enhancing access to credit remains critical to strengthen credit penetration in the region, empirical findings suggest that factors influencing demand for credit – per capita income, level of industrial activity and availability of infrastructure such as road network and power supply – also matter.
    Keywords: Bank Credit, Financial Inclusion, Infrastructure, Income, CD ratio, Eastern India
    JEL: E51 G21 R51
    Date: 2019–08–04
  4. By: Christian Lambert Nguena (University of Dschang)
    Abstract: Using a new database for mobile financial and banking services across countries, we analyze propoor and inclusive growth in developing countries and show the importance of mobile financial and banking development. This paper uses several econometric techniques to investigate mobile finance and banking benchmarking, determinants, and real impacts on inclusive growth in developing countries in Africa. The statistical benchmarking analysis reveals that there is a positive link between mobile banking development and economic development. Estimation of our model, using different specification and estimation techniques, shows the same result: a positive impact of mobile finance and banking development on both pro-poor and inclusive economic growth. These main findings suggest that policies to boost mobile finance and banking development in Africa should be viewed as measures that would yield fruit in the medium to long terms. Moreover, we find determinants of mobile finance and banking to be: banking sector domestic credit, human capital, remittances, credible monetary policy, infrastructure, and trade. Since mobile banking development matters for pro-poor and inclusive growth, African governments should pursue good performance in terms of these determinants by implementing specific and robust economic policies. JEL classification: G21, R1, O4Keywords: Mobile finance and banking, Africa, principal component analysis, financial innovation, financial inclusion
    Date: 2019–08–21
  5. By: Hanan Morsy (Research Department, African Development Bank); Amira El-Shal (Research Department, African Development Bank); Andinet Woldemichael (Research Department, African Development Bank)
    Abstract: Women are disproportionately disadvantaged in access to finance in Africa. While supply-side detriments, such as high interest rates and collateral requirements, are well documented in the literature, little is understood about how demand-side factors contribute to the observed gender gap in access to finance. This paper provides the first empirical evidence on how women managers’ perception about their creditworthiness contributes to the large gender gap in Africa, particularly in the Northern region. One of the innovations of the paper is introducing a theoretical model using the credit market framework with imperfect and asymmetric information to explain what may drive loan applicants to self-select. We use firm-level data for 47 African countries from the World Bank Enterprise Survey. We find that women entrepreneurs in Africa, in general, and in North Africa, in particular, are more likely to self-select themselves out of the credit market due to low perceived creditworthiness compared to their men counterparts. The results also suggest that the observed self-selection behavior is not a response mechanism to current discriminatory lending practices by the banks. The results are robust to different empirical specifications. The findings will inform policies towards greater financial inclusion of women in the region.
    Keywords: Gender Inequality; Access to Finance; Perception of Creditworthiness; Discrimination; Imperfect Information; Africa; North Africa.
    Date: 2019–07–24

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