Sunday, June 4, 2023
Financial Literacy, Experimental Preference Measures and Field Behavior: A Randomized Educational Intervention
Matthias Sutter (Mac Planck Institute), Michael Weyland (Ludwigsburg University), Anna Untertrifaller (University of Cologne), Manuel Froitzheim (University of Siegen), Sebastian O. Schneider (Max Planck Institute), Financial Literacy, Experimental Preference Measures and Field Behavior: A Randomized Educational Intervention, MPI Collective Goods Working Paper, No.2023/3 (2023):
We present the results of a randomized intervention to study how teaching financial literacy to 16-year-old high-school students affects their behavior in risk and time preference tasks. Compared to two different control treatments, we find that teaching financial literacy makes subjects behave more patiently, more time-consistent, and more risk-averse. These effects persist for up to almost 5 years after our intervention. Behavior in the risk and time preference tasks is related to financial behavior outside the lab, in particular spending patterns. This shows that teaching financial literacy affects economic decision-making which in turn is important for field behavior.