Financial Knowledge and Trust in Financial Institutions

40 Pages Posted: 4 Feb 2020

See all articles by Carin van der Cruijsen

Carin van der Cruijsen

De Nederlandsche Bank

Jakob de Haan

University of Groningen - Faculty of Economics and Business; De Nederlandsche Bank; CESifo (Center for Economic Studies and Ifo Institute)

Ria Roerink

De Nederlandsche Bank

Date Written: December 19, 2019

Abstract

Using fourteen years of data on Dutch consumers’ trust in financial institutions, we find that financially literate consumers are more likely to trust banks, insurance companies and pension funds, and the competence and integrity of the managers of these institutions. This holds both for broad-scope and narrow-scope trust. Although trust in respondents’ own financial institutions is significantly higher than general trust in financial institutions, both forms of trust are positively related. Financially knowledgeable people are more likely to trust the prudential supervisor. Finally, our results indicate that trust in the supervisor is positively related to trust in the financial sector.

Keywords: trust, financial institutions, financial literacy, consumer survey

JEL Classification: D12, D83, E58, G21, G22

Suggested Citation

van der Cruijsen, Carin and de Haan, Jakob and Roerink, Ria, Financial Knowledge and Trust in Financial Institutions (December 19, 2019). De Nederlandsche Bank Working Paper No. 662, December 2019. Available at SSRN: https://ssrn.com/abstract=3530886 or http://dx.doi.org/10.2139/ssrn.3530886

Carin van der Cruijsen (Contact Author)

De Nederlandsche Bank ( email )

PO Box 98
1000 AB Amsterdam
Amsterdam, 1000 AB
Netherlands

HOME PAGE: http://www.dnb.nl/en/onderzoek-2/onderzoekers/overzicht-persoonlijke-paginas/index.jsp

Jakob de Haan

University of Groningen - Faculty of Economics and Business ( email )

PO Box 800
Groningen, 9700 AV
Netherlands
+31 0 50 3633706 (Fax)

De Nederlandsche Bank ( email )

P.O. Box 98
Amsterdam, 1000 AB
Netherlands

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

HOME PAGE: http://www.CESifo.de

Ria Roerink

De Nederlandsche Bank ( email )

PO Box 98
1000 AB Amsterdam
Amsterdam, 1000 AB
Netherlands

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
27
Abstract Views
149
PlumX Metrics