The Role of Statistical Literacy in Risk Assessment and Behavior - Evidence from the COVID-19 Pandemic

47 Pages Posted: 1 Nov 2020 Last revised: 22 Apr 2022

See all articles by Daniel Metzger

Daniel Metzger

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM); European Corporate Governance Institute (ECGI); London School of Economics & Political Science (LSE) - Financial Markets Group

Mikael Paaso

Erasmus University Rotterdam (EUR)

Vesa Pursiainen

University of St. Gallen; Swiss Finance Institute

Date Written: April 21, 2022

Abstract

We study the role of statistical literacy in people's assessment of risk by analyzing risk expectations and behavior in the context of the COVID-19 pandemic. Using a large-scale panel survey of about 4,000 Dutch households, we find that more statistically literate people adjust their risk estimates more strongly to the actual infection risk, measured by the current number of confirmed COVID-19 cases in their home province. Consistently, they are more likely to socially distance, especially when local cases are high. We also show that statistically more literate people evaluate the risks and benefits of a vaccination against COVID-19 differently and are more likely to get vaccinated against COVID-19.

Keywords: statistical literacy, COVID-19, risk estimates, social distancing, vaccination

JEL Classification: D84, I12, I18, I20

Suggested Citation

Metzger, Daniel and Paaso, Mikael and Pursiainen, Vesa, The Role of Statistical Literacy in Risk Assessment and Behavior - Evidence from the COVID-19 Pandemic (April 21, 2022). Available at SSRN: https://ssrn.com/abstract=3715926 or http://dx.doi.org/10.2139/ssrn.3715926

Daniel Metzger

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM) ( email )

P.O. Box 1738
Room T08-21
3000 DR Rotterdam, 3000 DR
Netherlands

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

London School of Economics & Political Science (LSE) - Financial Markets Group ( email )

Houghton Street
London WC2A 2AE
United Kingdom

Mikael Paaso

Erasmus University Rotterdam (EUR) ( email )

Burgemeester Oudlaan 50
3000 DR Rotterdam, Zuid-Holland 3062PA
Netherlands

Vesa Pursiainen (Contact Author)

University of St. Gallen ( email )

Swiss Institute of Banking and Finance
Unterer Graben 21
St.Gallen, 9000
Switzerland

Swiss Finance Institute ( email )

c/o University of Geneva
40, Bd du Pont-d'Arve
CH-1211 Geneva 4
Switzerland

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