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Archive » February 2022 » Words matter. The impact of the questionnaire on the level of financial literacy in Italy

Words matter. The impact of the questionnaire on the level of financial literacy in Italy

Giovanna Paladino
February 2022 - n. 2
Keywords: Conoscenze finanziarie, framing, differenze di genere
Jel codes: G53, G50, D91

This paper takes its cue from the relevance of the framing effect in economic decision making. Most of the attempts made to measure financial literacy relies on surveys that include standardized questions about the knowledge of three or more fundamental concepts. A survey on 2,500 respondents representative of the Italian population shows that the same questions with different wording, aimed to create a higher degree of engagement, determine other answers, and better performance in terms of financial literacy, so wording matters. A more engaging wording mitigates the gender effect and reduces the probability of women choosing the «I do not know» option. However, the overall level of financial literacy does not improve. Financial literacy depends on socio-demographic variables (gender, age, education) and on self-evaluation of digital and economic skills. Knowledge of basic math plays a key role. Who knows how to compute a percentage correctly has a notably higher probability to be financially literate. A piece of evidence that provides clear policy indications.

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