Working Paper: NBER ID: w31145
Authors: Annamaria Lusardi; Olivia S. Mitchell
Abstract: We undertake an assessment of our two decades of research on financial literacy, building on our empirical research and theoretical work casting financial knowledge as a form of investment in human capital. We also draw on recent data to determine who is the most – and least – financially savvy in the United States, and we highlight the similarity of our results in other countries. A number of convincing studies is now available, from which we draw conclusions about the effects and consequences of financial illiteracy, and what can be done to fill these gaps. We conclude by offering our thoughts on implications for teaching, financial literacy programs, and future research.
Keywords: financial literacy; wealth inequality; economic decision-making
JEL Codes: G53
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| financial literacy (G53) | economic decision-making (D87) |
| financial literacy (G53) | financial well-being (G51) |
| financial literacy (G53) | wealth inequality (D31) |
| financial literacy (G53) | informed financial decisions (G11) |
| informed financial decisions (G11) | financial well-being (G51) |
| financial literacy (G53) | economic outcomes (F61) |