Working Paper: CEPR ID: DP15392
Authors: Samantha Horn; Julian C. Jamison; Dean Karlan; Jonathan Zinman
Abstract: Is financial knowledge change necessary for lasting behavior change? Or, akin to Friedman’s billiard player, can behavior persist 'as if' such knowledge is held? We randomize 240 Ugandan young-adult clubs to financial education, savings account access, both, or neither. Each education arm, but not the account-only arm, increases members’ financial knowledge and trust at one-year. At five-years, knowledge effects essentially disappear and trust effects weaken. However, savings, wealth and income increase for each treatment at both one and five years, suggesting multiple viable paths to statistically indistinguishable average outcomes and that textbook knowledge change is unnecessary for lasting impacts.
Keywords: financial education; financial literacy; financial access; savings
JEL Codes: D12; D91; O12
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Financial education (G53) | Financial knowledge (G53) |
| Financial education (G53) | Trust (G21) |
| Financial knowledge (G53) | Lasting behavior change (D15) |
| Account-only treatment (D10) | Savings (D14) |
| Account-only treatment (D10) | Income (D31) |
| Savings (D14) | Financial outcomes (G39) |
| Income (D31) | Financial outcomes (G39) |
| Financial education (G53) | Financial behaviors (G53) |