The Explanatory Power of Financial Literacy on Consumer Financial Behaviors: New Evidence from Europe

Abstract

The paper analyses data from different European countries (UK, Italy, Germany, etc.) in order to test how different measures of financial literacy can have a different explanatory power of different financial behaviors. Using data from a research project promoted by the CFRC (Consumer Finance Research Center) that includes a broad set of financial literacy items, results confirm the hypothesis that the standard measures adopted in several previous studies undere

stimated the role of financial literacy on consumer financial behaviors. The evidence that even knowledge on basic financial principles is enough to affect individual financial decisions supports the development of financial education initiatives and justifies the efforts to plan national financial education strategies.

About the speaker

Gianni Nicolini (PhD) is Associate Professor of Finance at the Department of Management and Law of the University of Rome "Tor Vergata" (Faculty of Economics), where is the PhD program coordinator of the PhD in Management (track Banking and Finance). His main research interests concern the consumer finance, with a special interest on financial literacy and financial education. With several colleagues from different universities and research institutes promoted the Consumer Finance Research Center (CFRC) with the aim to do research on financail consumer related issues. He works as academic counsellor in the National Financial Education Strategic Committee established by the Italian Government in 2016.