Working Paper: CEPR ID: DP15532
Authors: Robert Clark; Annamaria Lusardi; Olivia S. Mitchell
Abstract: Early in the COVID-19 pandemic, much of the US economy was closed to limit the virus’ spread, and several emergency interventions were implemented. Our analysis of older (45-75) respondents fielded in April-May of 2020 indicates that about one in five respondents was financially fragile and would have difficulty facing a mid-size emergency expense. Some subgroups were at particular risk of facing financial difficulties, especially younger respondents, those with larger families, Hispanics, and the low income. Moreover, the more financially literate were better able to handle such shocks, indicating that knowledge can provide some additional protection during a pandemic.
Keywords: financial literacy; financial resilience; older population; vulnerable groups
JEL Codes: G53; D14; I38
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| financial literacy (G53) | financial fragility (G51) |
| demographic factors (J11) | financial fragility (G51) |
| financial literacy (G53) | financial behavior (G53) |
| financial behavior (G53) | financial fragility (G51) |
| financial literacy (G53) | resilience against economic shocks (F69) |