This question comes up a lot when talking about financial education. School districts ask this question when considering if schools should offer personal finance courses. State policy makers ask this question when contemplating if financial education should be a requirement for high school graduation. Even teachers and parents may wonder if advocating for more financial education is worth the effort, will it make an impact?
One of the best ways to answer this question, is to look at the research.
Tim Kaiser, Annamaria Lusardi, Lukas Menkhoff, and Carly Urban’s recently released working paper, Financial Education Affects Financial Knowledge and Downstream Behaviors, seeks to answer just that question.
The field of financial literacy has exploded in the last few years, which means there is a lot more research out there about financial education. With all this research, it can be hard to know what their findings are and what those findings mean. Therefore, this paper looks at a lot of different studies to understand if there was a common result, known as a meta-analysis. The co-authors examine 76 rigorous studies which cover 33 countries across six continents. By looking at rigorous studies only, they can determine if financial education causes improvements in financial knowledge and behavior. Moreover, because they aggregate these studies, they are able to examine results for over 160,000 individuals.
Key findings of the paper:
A recent working paper by Tim Kaiser, Annamaria Lusardi, Lukas Menkhoff, and Carly Urban examines the growing literature on financial education. In the paper, the authors examine 76 research studies with over 160,000 individuals from around the world. Results from their analysis show that financial education, on average, has a significant impact on financial knowledge and behavior. Moreover, the effects they find from financial education have meaningful implications.
A PowerPoint presentation of a recent paper, which shows that financial education does have a significant impact on financial knowledge and behavior.
Prof. Annamaria Lusardi and Dr. Tim Kaiser present findings of the paper Financial Education Affects Financial Knowledge and Downstream Behaviors. In the paper, they study 76 research studies with over 160,000 individuals. Results show that financial education results in improved financial knowledge and behavior.