Subjective variables of Financial Well-being and Individual Economic Behavior: Pre-and Post- Financial Literacy Intervention
Keywords:
Financial Awareness, Financial Perception, Financial Attitude, Financial BehaviourAbstract
Financial wellbeing is usually objectively measured and also views as a subjective concept that refers to "How people feel or evaluate themselves related to money matters". Personal economic well-being is a multifaceted subjective concept that includes subjective variables of Financial Well-being like financial satisfaction, financial behaviour, attitude, and perceptions of Individual related to financial decisions. In this multi-disciplinary experimental research, the paper focused on two objectives: 1) to study the relationship between subjective variables of Financial- wellbeing and 2) on observing variation in the subjective variables of Financial- wellbeing in both situations of Pre-and Post-Financial Literacy intervention. The sample of the study consists of 308 working people as respondents in tri-city Chandigarh. The questionnaire covers subjective variables of Financial-wellbeing, i.e., 1) Individual Economic Behaviour, 2) Financial-Awareness, 3) Financial-
Perception, 4) Financial-Attitude, and 5) Socio-economic-demographic characteristics of respondents. The study reveals that: 1) a significant relationship between other subjective variables of Financial-wellbeing and Individual Economic Behavior among, 2) a significant relationship exists between Individual Economic Behaviour and socio-economic demographic variables, i.e., Income and employment level, 3) The paired t-test reveals that a substantial improvement in subjective variables of Financial-wellbeing and Individual Economic Behaviour in Post- Financial Literacy Intervention situation among working people in tri-city Chandigarh in Pre- and Post- Financial Literacy Intervention. Thus, Financial Literacy has a positive impact on Economic Behaviour and subjective variables of Financial-wellbeing among Individuals.
Downloads
References
Ameriks, John, Andrew Caplin, John Leahy, and Tom Tyler, 2003c, “Measuring Self- Control,” Working Paper, New York University.
Antonides G., I.M. de Groot, W.F. van Raaij, 2011 “Mental budgeting and the management of household finance” J. Econ. Psychol., 32 (4) (2011), pp. 546-555
Atkinson, A. and F. Messy (2012), "Measuring Financial Literacy: Results of the OECD
/ International Network on Financial Education (INFE) Pilot Study", OECD Working Papers on Finance, Insurance and Private Pensions, No. 15, OECD Publishing,
Paris, http://dx.doi.org/10.1787/5k9csfs90fr4-en
Brown, Sarah and Karl Taylor. "Household Finances and the 'Big Five' Personality Traits." IZA, Discussion Paper (2011)
Byrnes, James P., Miller, David C., and Schafer, William D., (1999) “Gender Differences in Risk Taking: Meta-Analysis”, Psychological Bulletin ,125(3), 367-3833: https://www.researchgate.net/publication/271767720_Gender_differences_in_risk_takin g_A_meta-analysis
Cacioppo, J. T., & Petty, R. E., (1982). “The need for cognition” Journal of Personality and Social Psychology, 42(1), 116–131. https://doi.org/10.1037/0022-3514.42.1.116
Chen, H. and Volpe, R. P., (1998) “An analysis of personal financial literacy among college student” Financial Services Review, 7 (2), 107-128.
Cole, S. & Shastry, G. K., (2008) “If You Are So Smart, Why Aren't You Rich? The Effects of Education. Financial Literacy and Cognitive Ability in Financial market Participation” HBS Working Paper 09-071.
Heck, Ramona, Z.,(1984) “The determinant of Financial Management Behaviour Among College Students: Implications for Consumer Education” The Journal of Consumer Education, Vol.2
Hilgert, M.A., Hogarth, J.M. & Beverly, S.G., (2003) “Household financial management: the connection between knowledge and behavior”, Federal Reserve Bulletin, July,333
Leonard, M. D. L., (2012) “Risk preferences and expected utility: Evidence from labour supply data” Economic Inquiry, 50(1), 264–276. https://doi.org/10.1111/j.1465- 7295.2011.00389.x
Locke, E.A., (1969) “Towards a theory of task motivation and incentives” Organization Behaviour and Human Performance lower-income families. Chicago: Woodstock Institute.
Locke, E.A and Latham,.G.P.,(1991) “Self-regulation through Goal-setting,
Organisational behaviour and Human Decision Process 50, page no. 212-247
Lusardi, A and Mitchell, Olivia,(2007) “Financial Literacy and Retirement Planning: New Evidence From Rand American Life Penal”, National Bureau of Economic Research pg. 38
Lusardi, A. & Tufano, P.,(2009) “Debt Literacy, Financial Experiences and Over- indebtedness” NBER. Working Paper No. 14808. CFS Working Paper No. 2009/08.http://dx.doi.org/10.3386/w14808
Lusardi, A.,(2008, June) “Financial Literacy, An Essential Tool for Informed Consumer Choice” NBER Working Paper No. 14084. Joint Center for Housing Studies, Harvard University. http://dx.doi.org/10.3386/w14084.
Lusardi, A., & Mitchell, O. S., (2011) “Financial Literacy around the world: an overview” Journal of Pension Economics and Finance, 10(4), 497–508. https://doi.org/10.1017/S1474747211000448
Lusardi, A., & Mitchell, O. S., (2014) “The Economic Importance of Financial Literacy: Theory and Evidence” Journal of Economic Literature, 52(1), 5-44. doi:10.1257/jel.52.1.5
Lusardi, A., & Tufano, P.,(2015) “Debt literacy, financial experiences, and over- indebtedness” Journal of Pension Economics & Finance, 14(4), 332-368. doi:10.1017/s1474747215000232
Mahdzan, N. S., & Tabiani, S., (2013) “The Impact of Financial Literacy on Individual Saving: An Exploratory Study in the Malaysian Context” Transformation in Business & Economics, 12(1), 54–69.
Maria, J. R. G., (2013) “Financial Education and Behavioral Finance: New Insights into the Role of Information in Financial Decisions”. Journal of Economic Surveys. Vol. 27(2), 297-315. (SSRN:http://ssrn.com/abstract=2229645). http://dx.doi.org/10.1111/j.1467-6419.2011.00705.x.
Mariger, R., 1987, “A Life-Cycle Consumption Model with Liquidity Constraints: Theory and Empirical Results.” Econometrica, vol. 55, 533-557.
Martin, K., & Paul Hill, R. (2012). "Life Satisfaction, Self-Determination, and Consumption Adequacy at the Bottom of the Pyramid", Journal of Consumer Research, 38(6), 1155-1168. doi:10.1086/661528
Meier, S. and C.D. Sprenger, (2008) “Discounting Financial Literacy: Time Preference and participation in Financial Education Programmes” Leibniz Information Centre for Economics' Discussion Paper No. 3507.
OCED, 2017 Organization Economic Co-operation and Development, (2017) “Use of Behavioural Insights in Consumer Policy” OECD Science, Technology and Innovation Policy Papers, No 36 OECD Publishing Available at http://www.oecd- ilibrary.org/industry-and-services/use-of-behavioral-economics-9789264207851-en.htm
Oheler, Andreas. , Wendt, Stefan., Wedlich, Florian., and Horn, Matthias,(2018) "Investors' Personality influences Investment Decisions : Experimental Evidence on Extraversion and Neuroticism” Journal of Behavioral Finance, vol.19. https://doi.org/10.1080/15427560.2017.1366495
Thaler, Richard H., Werner F. M. De Bondt, "Financial Decision-Making in Markets and Firms: A Behavioural Perspective" The National Bureau of Economic Research, 1991.
Volpe P. Ronald, Chen, Haiyang., and Liu, Sheen (2006) An Analysis of the Importance of Personal Finance topics and the level of Knowledge possessed by Working Adults,
Financial Review 15,81-98
Xiao, J. J. (2008). Handbook of Consumer Finance Research. p. 70.
Downloads
Published
How to Cite
Issue
Section
License
You are free to:
- Share — copy and redistribute the material in any medium or format for any purpose, even commercially.
- Adapt — remix, transform, and build upon the material for any purpose, even commercially.
- The licensor cannot revoke these freedoms as long as you follow the license terms.
Under the following terms:
- Attribution — You must give appropriate credit , provide a link to the license, and indicate if changes were made . You may do so in any reasonable manner, but not in any way that suggests the licensor endorses you or your use.
- No additional restrictions — You may not apply legal terms or technological measures that legally restrict others from doing anything the license permits.
Notices:
You do not have to comply with the license for elements of the material in the public domain or where your use is permitted by an applicable exception or limitation .
No warranties are given. The license may not give you all of the permissions necessary for your intended use. For example, other rights such as publicity, privacy, or moral rights may limit how you use the material.
