Does gender disparity in financial literacy still persist after retirement? Evidence from Ghana
08 Jan 2018-International Journal of Social Economics (Emerald Publishing Limited)-Vol. 45, Iss: 1, pp 18-28
Abstract: Purpose The purpose of this paper is to examine the gender disparity in financial literacy among retirees in the Cape Coast metropolis in Ghana. Design/methodology/approach Finding of this paper is based on 334 respondents (183 males and 151 females) to financial literacy questionnaires covering the respondents’ general knowledge on budgeting, use of Automated Teller Machine (ATM), time value of money, account types, cheque handling and insurance. Data was analysed with Pearson Chi-Square and Independent sample t-test. Findings Nominal scores showed male domination in financial literacy in seven out of the ten questions used to assess financial literacy while female retirees lead in three. These observed nominal differences were, however, found not to be significant through Chi-square test of independence except the question on the calculation of interest rate on loans in favour of males. The cumulative effect, through computation of financial literacy index was deemed to be significantly different betwee...
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TL;DR: Financial services inclusion profoundly appears to buffer against and retard health-related challenges in later life, and should be included in social and health policies targeted at improving the health outcomes of older people.
Abstract: Purpose:This study examines the associations between financial inclusion, health-seeking behavior, and health-related outcomes in older persons in Ghana.Method:Employing data from a 2016/2017 Aging...
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Cites background from "Does gender disparity in financial ..."
...Some evidence suggests that countries such as India and South Africa among other LMICs have started operating universal opening of checking bank accounts for their general populations as a means to reduce cash handling and transfers in cash (Adam et al., 2018; Aker et al., 2011; Goldberg, 2014)....
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References
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TL;DR: An assessment of a rapidly growing body of economic research on financial literacy and thoughts on what remains to be learned if researchers are to better inform theoretical and empirical models as well as public policy are offered.
Abstract: This paper undertakes an assessment of a rapidly growing body of economic research on financial literacy. We start with an overview of theoretical research which casts financial knowledge as a form of investment in human capital. Endogenizing financial knowledge has important implications for welfare as well as policies intended to enhance levels of financial knowledge in the larger population. Next, we draw on recent surveys to establish how much (or how little) people know and identify the least financially savvy population subgroups. This is followed by an examination of the impact of financial literacy on economic decision-making in the United States and elsewhere. While the literature is still young, conclusions may be drawn about the effects and consequences of financial illiteracy and what works to remedy these gaps. A final section offers thoughts on what remains to be learned if researchers are to better inform theoretical and empirical models as well as public policy.
2,176 citations
TL;DR: In this article, the authors evaluated the importance of financial literacy by studying its relation to the stock market: are more financially knowledgeable individuals more likely to hold stocks? To assess the direction of causality, they make use of questions measuring financial knowledge before investing in the stock markets.
Abstract: Individuals are increasingly put in charge of their financial security after retirement. Moreover, the supply of complex financial products has increased considerably over the years. However, we still have little or no information about whether individuals have the financial knowledge and skills to navigate this new financial environment. To better understand financial literacy and its relation to financial decision-making, we have devised two special modules for the DNB Household Survey. We have designed questions to measure numeracy and basic knowledge related to the working of inflation and interest rates, as well as questions to measure more advanced financial knowledge related to financial market instruments (stocks, bonds, and mutual funds). We evaluate the importance of financial literacy by studying its relation to the stock market: Are more financially knowledgeable individuals more likely to hold stocks? To assess the direction of causality, we make use of questions measuring financial knowledge before investing in the stock market. We find that, while the understanding of basic economic concepts related to inflation and interest rate compounding is far from perfect, it outperforms the limited knowledge of stocks and bonds, the concept of risk diversification, and the working of financial markets. We also find that the measurement of financial literacy is very sensitive to the wording of survey questions. This provides additional evidence for limited financial knowledge. Finally, we report evidence of an independent effect of financial literacy on stock market participation: Those who have low financial literacy are significantly less likely to invest in stocks.
1,834 citations
TL;DR: In this paper, the authors present an assessment of a rapidly growing body of economic research on financial literacy and examine the impact of financial literacy on economic decision-making in the United States and elsewhere.
Abstract: This paper undertakes an assessment of a rapidly growing body of economic research on financial literacy. We start with an overview of theoretical research, which casts financial knowledge as a form of investment in human capital. Endogenizing financial knowledge has important implications for welfare, as well as policies intended to enhance levels of financial knowledge in the larger population. Next, we draw on recent surveys to establish how much (or how little) people know and identify the least financially savvy population subgroups. This is followed by an examination of the impact of financial literacy on economic decision making in the United States and elsewhere. While the literature is still young, conclusions may be drawn about the effects and consequences of financial illiteracy and what works to remedy these gaps. A final section offers thoughts on what remains to be learned if researchers are to better inform theoretical and empirical models as well as public policy. (JEL A20, D14, G11, I20, J26)
1,741 citations
TL;DR: In this article, the authors evaluated the importance of financial literacy by studying its relation to the stock market: are more financially knowledgeable individuals more likely to hold stocks? To assess the direction of causality, they make use of questions measuring financial knowledge before investing in the stock markets.
1,591 citations
TL;DR: The authors compare wealth holdings across two cohorts of the Health and Retirement Study: the early Baby Boomers in 2004, and individuals in the same age group in 1992, and find that planners in both cohorts arrive close to retirement with much higher wealth levels and display higher financial literacy than non-planners.
1,367 citations