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on Financial Literacy and Education |
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Issue of 2020‒08‒31
four papers chosen by |
| By: | Nicole Jonker; Anneke Kosse |
| Abstract: | The entry of Big Tech firms in the financial ecosystem might affect financial stability through the opportunities and challenges they create for financial inclusion. In this paper we survey the literature to determine the effectiveness of financial education in improving financial literacy and financial inclusion and to assess the impact of financial inclusion on financial stability. Based on our findings, we argue that new empirical research is needed to determine whether financial education can play a role in ensuring that everyone is able to reap the financial-inclusion benefits that Big Tech may bring. We also conclude that financial-inclusion opportunities created by Big Tech might potentially introduce risks for overall financial stability. Because of this, we underline the importance of proper supervision and regulation. |
| Keywords: | Big Tech; Fintech; Financial Services; Financial Education; Financial Literacy; Financial Inclusion; Financial Stability |
| JEL: | D14 D91 D92 G21 G23 O16 |
| Date: | 2020–08 |
| URL: | http://d.repec.org/n?u=RePEc:dnb:dnbwpp:692&r=all |
| By: | Matthias Sutter (Max Planck Institute for Research on Collective Goods, Bonn, University of Cologne, University of Innsbruck, IZA Bonn, and CESifo Munich); Michael Weyland (Ludwigsburg University of Education); Anna Untertrifaller (University of Cologne); Manuel Froitzheim (University of Siegen) |
| Abstract: | We present the results of a randomized intervention in schools to study how teaching financial literacy affects risk and time preferences of adolescents. Following more than 600 adolescents, aged 16 years on average, over about half a year, we provide causal evidence that teaching financial literacy has significant short-term and longer-term effects on risk and time preferences. Compared to two different control treatments, we find that teaching financial literacy makes subjects more patient, less present-biased, and slightly more risk-averse. Our finding that the intervention changes economic preferences contributes to a better understanding of why financial literacy has been shown to correlate systematically with financial behavior in previous studies. We argue that the link between financial literacy and field behavior works through economic preferences. In our study, the latter are also related in a meaningful way to students’ field behavior. |
| Keywords: | Financial literacy, randomized intervention, risk preferences, time preferences, field experiment |
| JEL: | C93 D14 I21 |
| Date: | 2020–08 |
| URL: | http://d.repec.org/n?u=RePEc:ajk:ajkdps:019&r=all |
| By: | Piera Bello (Istituto di economia politica (IDEP), Facoltà di scienze economiche, Università della Svizzera italiana, Svizzera) |
| Abstract: | This paper studies gender-based price discrimination in the annuity market. The dataset consists of transaction-level data on the universe of individuals accessing the Chilean annuity market in the 2004-2017 period. It exploits the fact that, in Chile, individuals can access the annuity market through three different channels: an independent financial advisor, a sales agent at a company, or directly at a PFA (Pension Fund Administrator). The analysis shows that sales agents severely distort prices to the detriment of women customers. Women who consult sales agents pay higher transaction prices compared to the other two groups of women, while there is no variation in men’s prices across the three channels for market access. Additional evidence shows that this is not driven by differences in negotiation skills or type of annuity product purchased but rather by differences in initial prices. Firms charge higher initial prices to women who access the market through one of their sales agents. These results are consistent with an explanation that links the lack of competition between firms to discriminatory behaviour against female customers. Gender differences in financial literacy might explain why firms find it profitable to offer higher prices to women. |
| Keywords: | annuity market, insurers, gender, bargaining, statistical inference |
| JEL: | J16 C78 G22 D81 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:lug:wpidep:2002&r=all |
| By: | Asongu, Simplice; Odhiambo, Nicholas |
| Abstract: | This study provides thresholds of inequality that should not be exceeded if gender inclusive education is to enhance gender inclusive formal economic participation in sub-Saharan Africa. The empirical evidence is based on the Generalised Method of Moments and data from 42 countries during the period 2004-2014. The following findings are established. First, inclusive tertiary education unconditionally promotes gender economic inclusion while the interaction between tertiary education and inequality is unfavourable to gender economic inclusion. Second, a Gini coefficient that nullifies the positive incidence of inclusive tertiary education on female labour force participation is 0.562. Second, the Gini coefficient and the Palma ratio that crowd-out the negative unconditional effects of inclusive tertiary education on female unemployment are 0.547 and 6.118, respectively. Third, a 0.578 Gini coefficient, a 0.680 Atkinson index and a 6.557 Palma ratio are critical masses that wipe-out the positive unconditional effects of inclusive tertiary education on female employment. Findings associated with lower levels of education are not significant. As the main policy implication, income inequality should not be tolerated above the established thresholds in order for gender inclusive education to promote gender inclusive formal economic participation. Other implications are discussed in the light of Sustainable Development Goals. This research complements the existing literature by providing inequality thresholds that should not be exceeded in order for gender inclusive education to promote the involvement of women in the formal economic sector. |
| Keywords: | Africa; Inequality; Gender; Inclusive development |
| JEL: | G20 I10 I32 O40 O55 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:102033&r=all |