Childhood Roots of Financial Literacy

44 Pages Posted: 24 Sep 2015

See all articles by Antonia Grohmann

Antonia Grohmann

German Institute for Economic Research (DIW Berlin)

Roy Kouwenberg

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE); Mahidol University - College of Management

Lukas Menkhoff

German Institute for Economic Research (DIW Berlin); Humboldt University of Berlin - Faculty of Economics

Date Written: August 2015

Abstract

Financial literacy predicts informed financial decisions, but what explains financial literacy? We use the concept of financial socialization and aim to represent three major agents of financial socialization: family, school and work. Thus we compile twelve relevant childhood characteristics in a new survey study and examine their relation to financial literacy, while controlling for established socio-demographic characteristics. We find in a mediation analysis that both family and school positively affect the financial literacy of adults. Moreover, financial literacy and school related variables also have a direct effect on financial behavior. This suggests that family factors and schooling work through complementary channels.

Keywords: Financial literacy, financial behavior, family background, education, numeracy

JEL Classification: D14, G11, I20

Suggested Citation

Grohmann, Antonia and Kouwenberg, Roy R. P. and Menkhoff, Lukas, Childhood Roots of Financial Literacy (August 2015). DIW Berlin Discussion Paper No. 1504. Available at SSRN: https://ssrn.com/abstract=2664468 or http://dx.doi.org/10.2139/ssrn.2664468

Antonia Grohmann

German Institute for Economic Research (DIW Berlin) ( email )

Mohrenstra├če 58
Berlin, 10117
Germany

Roy R. P. Kouwenberg

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE) ( email )

P.O. Box 1738
3000 DR Rotterdam, NL 3062 PA
Netherlands

HOME PAGE: http://people.few.eur.nl/kouwenberg

Mahidol University - College of Management ( email )

69 Vipawadee Rangsit Road
Bangkok, 10400
Thailand

HOME PAGE: http://www.cmmu.mahidol.ac.th/main/faculty/aroy.asp

Lukas Menkhoff (Contact Author)

German Institute for Economic Research (DIW Berlin) ( email )

Mohrenstra├če 58
Berlin, 10117
Germany

Humboldt University of Berlin - Faculty of Economics ( email )

Spandauer Strasse 1
Berlin
Germany

Register to save articles to
your library

Register

Paper statistics

Downloads
80
Abstract Views
793
rank
301,100
PlumX Metrics