Consumer Financial Education and Financial Capability

International Journal of Consumer Studies, Forthcoming

32 Pages Posted: 26 Apr 2016

See all articles by Jing Jian Xiao

Jing Jian Xiao

University of Rhode Island

Barbara O'Neill

Rutgers University - Rutgers Cooperative Extension

Date Written: 2016

Abstract

The purpose of this study was to explore potential effects of financial education on the financial capability of American consumers. Data from the 2012 National Financial Capability Study were used to test the hypothesis that financial education is positively associated with financial capability. Four financial literacy and behavior variables were used to form a financial capability index. Multivariate linear regression results showed that, after controlling for demographic and financial variables, respondents who ever received financial education had higher scores in all financial capability indicators (objective financial literacy, subjective financial literacy, desirable financial behavior, perceived financial capability, and the financial capability index). In addition, high school, college, and workplace financial education variables showed positive associations with these financial capability indicators. Additional state comparison analyses provided evidence suggesting high school financial education may have direct impacts and spillover effects on consumer financial capability.

Keywords: financial behavior, financial capability, financial education, financial literacy, U.S. National Financial Capability Study

JEL Classification: D12

Suggested Citation

Xiao, Jing Jian and O'Neill, Barbara, Consumer Financial Education and Financial Capability (2016). International Journal of Consumer Studies, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2769384

Jing Jian Xiao (Contact Author)

University of Rhode Island ( email )

Transition Center
Kingston, RI 02881
United States
401-874-2547 (Phone)
401-874-4020 (Fax)

HOME PAGE: http://www.uri.edu/hss/hdf/faculty/JingJXiao.htm

Barbara O'Neill

Rutgers University - Rutgers Cooperative Extension ( email )

55 Dudley Road
New Brunswick, NJ 0801-8520
United States

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