Financial Literacy and Gambling Behavior: Evidence from Japan
TL;DR: The results from the probit-instrumental variable model show that financial literacy has a significantly negative relationship with gambling frequency, while financial education has no significant relationship withambling frequency.
Abstract: According to a survey by Japan’s Ministry of Health, Labor, and Welfare in 2017, 3.6% of Japanese adults—equivalent to about 3.2 million people—have suffered from problem gambling at some point in their lifetime. This study examines the relationship between financial literacy, financial education, and gambling behavior (measured as gambling frequency) among the Japanese population. We hypothesize that financially literate and financially educated people who use their knowledge to make sound financial decisions are less likely to gamble. The data used in this study are from a nationwide survey in Japan from the Preference Parameters Study of Osaka University in 2010 (n = 3687). To control for endogeneity bias between financial literacy and gambling behavior, we use the education of respondents’ fathers as an instrumental variable. The results from the probit-instrumental variable model show that financial literacy has a significantly negative relationship with gambling frequency, while financial education has no significant relationship with gambling frequency. Our findings suggest that problem gambling may be mitigated by promoting financial literacy, but no such conclusion can be drawn for financial education.
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TL;DR: The authors examined the relationship between demographic and socio-economic factors and financial literacy in Japan by segregating financial literacy into financial knowledge, attitude, and behavior, and provided a deeper understanding of the relationships.
Abstract: Success in the current complex and sophisticated financial marketplaces depends on the ability of people to make sustainable financial decisions to improve their future well-being, for which financial literacy is a pathway. This study examines the relationship between the demographic and socio-economic factors and financial literacy in Japan by segregating financial literacy into financial knowledge, attitude, and behavior, and providing a deeper understanding of the relationships. The methodology included using data from the Financial Literacy Survey 2016 by the Central Council for Financial Services Information of Japan. We used a linear regression model to explain how demographic and socio-economic factors relate to financial knowledge, attitude, and behavior. Results show that education, the balance of financial assets, and the use of financial information are positively related, while the experience of financial trouble is negatively related to financial knowledge, attitude, and behavior. We show that males are more financially knowledgeable than females, but females are more positive than males with regard to financial behavior and financial attitude. Age is positively related to financial knowledge but negatively related to financial attitude, thus suggesting that middle-aged people in Japan are more financially knowledgeable, but younger and older people are more positive with regard to financial behavior and attitude. The findings have implications for policymakers.
35 citations
TL;DR: This paper found that people with high financial literacy tend to take too many risks, overborrow, and hold naive financial attitudes; that is, financial literacy makes people daring and reckless in some financial aspects.
Abstract: Using purpose-built original 2018 Japanese survey data, we estimate the financial behaviors and attitudes of households. We find that financial literacy plays an important and consistent role in financial decision-making. However, the actual behaviors are counter-intuitive: People with high financial literacy tend to take too many risks, overborrow, and hold naive financial attitudes; that is, financial literacy makes people daring and reckless in some financial aspects. By contrast, financially literate people are good at retirement planning and are indifferent to gambling. Preferences such as risk and loss aversions and discount factors, also have a role in financial choices.
22 citations
TL;DR: In this article, the authors used longitudinal data from Hiroshima University to investigate loneliness before and during the COVID-19 pandemic among older and younger people in Japan and provided evidence that loneliness among both younger and older people increased considerably during the pandemic.
Abstract: The precautionary measures and uncertainties surrounding the COVID-19 pandemic have serious psychological impacts on peoples' mental health. We used longitudinal data from Hiroshima University to investigate loneliness before and during the pandemic among older and younger people in Japan. We provide evidence that loneliness among both older and younger people increased considerably during the pandemic. Although loneliness among younger people is more pervasive, the magnitude of increase in loneliness during the pandemic is higher among older people. Our logit regression analysis shows that age, subjective health status, and feelings of depression are strongly associated with loneliness before and during the pandemic. Moreover, household income and financial satisfaction are associated with loneliness among older people during the pandemic while gender, marital status, living condition, and depression are associated with loneliness among younger people during the pandemic. The evidence of increasing loneliness during the pandemic is concerning for a traditionally well-connected and culturally collectivist society such as Japan. As loneliness has a proven connection with both physical and mental health, we suggest immediate policy interventions to provide mental health support for lonely people so they feel more cared for, secure, and socially connected.
20 citations
TL;DR: The authors found that people with high levels of financial literacy tend to take too many risks, overborrow, and hold naive financial attitudes, and that financial literacy tends to cause people to become daring and reckless toward some financial aspects.
Abstract: Using original purpose-built 2018 Japanese survey data, we estimate the financial behaviors and attitudes of households. We find that financial literacy plays an important and consistent role in financial decision-making. However, the actual behaviors are counter-intuitive: people with high levels of financial literacy tend to take too many risks, overborrow, and hold naive financial attitudes. That is, financial literacy tends to cause people to become daring and reckless toward some financial aspects. By contrast, financially literate people are better at retirement planning and are indifferent to gambling. Preferences such as risk and loss aversions and discount factors, also play a role in financial choices.
18 citations
TL;DR: In this paper, the influence of financial literacy and financial education on the smoking behavior in the United States in terms of the use of rational decision-making abilities to reduce irrational behavior was examined.
Abstract: Smoking is still a serious economic, health, and social problem despite various efforts to curb its prevalence. We examined the influence of financial literacy and financial education on the smoking behavior in the United States in terms of the use of rational decision-making abilities to reduce irrational behavior. We hypothesized that financial literacy and financial education, as proxies for rational decision making, would reduce the likelihood of smoking. We used data from the Preference Parameters Study (PPS) of Osaka University conducted in the United States in 2010 and applied probit regression models to test our hypothesis on a sample of 3831 individuals. We found that financially literate people are less likely to be smokers, though we found no clear role of financial education in reducing the likelihood of smoking. Further, respondents’ gender, age, unemployment status, and risky health behaviors such as drinking and gambling, have a significantly positive association with smoking, while marital status, university degree, family size, household income, household assets, physical exercise, and level of happiness have a significantly negative association. Our findings suggest that financial literacy, as an instrument encouraging rational decision making, could be a tool to help reduce smoking in the United States.
16 citations
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TL;DR: An issue concerning the criteria for tic disorders is highlighted, and how this might affect classification of dyskinesias in psychotic spectrum disorders.
Abstract: Given the recent attention to movement abnormalities in psychosis spectrum disorders (e.g., prodromal/high-risk syndromes, schizophrenia) (Mittal et al., 2008; Pappa and Dazzan, 2009), and an ongoing discussion pertaining to revisions of the Diagnostic and Statistical Manuel of Mental Disorders (DSM) for the upcoming 5th edition, we would like to take this opportunity to highlight an issue concerning the criteria for tic disorders, and how this might affect classification of dyskinesias in psychotic spectrum disorders.
Rapid, non-rhythmic, abnormal movements can appear in psychosis spectrum disorders, as well as in a host of commonly co-occurring conditions, including Tourette’s Syndrome and Transient Tic Disorder (Kerbeshian et al., 2009). Confusion can arise when it becomes necessary to determine whether an observed movement (e.g., a sudden head jerk) represents a spontaneous dyskinesia (i.e., spontaneous transient chorea, athetosis, dystonia, ballismus involving muscle groups of the arms, legs, trunk, face, and/or neck) or a tic (i.e., stereotypic or patterned movements defined by the relationship to voluntary movement, acute and chronic time course, and sensory urges). Indeed, dyskinetic movements such as dystonia (i.e., sustained muscle contractions, usually producing twisting and repetitive movements or abnormal postures or positions) closely resemble tics in a patterned appearance, and may only be visually discernable by attending to timing differences (Gilbert, 2006).
When turning to the current DSM-IV TR for clarification, the description reads: “Tic Disorders must be distinguished from other types of abnormal movements that may accompany general medical conditions (e.g., Huntington’s disease, stroke, Lesch-Nyhan syndrome, Wilson’s disease, Sydenham’s chorea, multiple sclerosis, postviral encephalitis, head injury) and from abnormal movements that are due to the direct effects of a substance (e.g., a neuroleptic medication)”. However, as it is written, it is unclear if psychosis falls under one such exclusionary medical disorder. The “direct effects of a substance” criteria, referencing neuroleptic medications, further contributes to the uncertainty around this issue. As a result, ruling-out or differentiating tics in psychosis spectrum disorders is at best, a murky endeavor.
Historically, the advent of antipsychotic medication in the 1950s has contributed to the confusion about movement signs in psychiatric populations. Because neuroleptic medications produce characteristic movement disorder in some patients (i.e. extrapyramidal side effects), drug-induced movement disturbances have been the focus of research attention in psychotic disorders. However, accumulating data have documented that spontaneous dyskinesias, including choreoathetodic movements, can occur in medication naive adults with schizophrenia spectrum disorders (Pappa and Dazzan, 2009), as well as healthy first-degree relatives of chronically ill schizophrenia patients (McCreadie et al., 2003). Taken together, this suggests that movement abnormalities may reflect pathogenic processes underlying some psychotic disorders (Mittal et al., 2008; Pappa and Dazzan, 2009).
More specifically, because spontaneous hyperkinetic movements are believed to reflect abnormal striatal dopamine activity (DeLong and Wichmann, 2007), and dysfunction in this same circuit is also proposed to contribute to psychosis, it is possible that spontaneous dyskinesias serve as an outward manifestation of circuit dysfunction underlying some schizophrenia-spectrum symptoms (Walker, 1994). Further, because these movements precede the clinical onset of psychotic symptoms, sometimes occurring in early childhood (Walker, 1994), and may steadily increase during adolescence among populations at high-risk for schizophrenia (Mittal et al., 2008), observable dyskinesias could reflect a susceptibility that later interacts with environmental and neurodevelopmental factors, in the genesis of psychosis.
In adolescents who meet criteria for a prodromal syndrome (i.e., the period preceding formal onset of psychotic disorders characterized by subtle attenuated positive symptoms coupled with a decline in functioning), there is sometimes a history of childhood conditions which are also characterized by suppressible tics or tic like movements (Niendam et al., 2009). On the other hand, differentiating between tics and dyskinesias has also complicated research on childhood disorders such as Tourette syndrome (Kompoliti and Goetz, 1998; Gilbert, 2006).
We propose consideration of more explicit and operationalized criteria for differentiating tics and dyskinesias, based on empirically derived understanding of neural mechanisms. Further, revisions of the DSM should allow for the possibility that movement abnormalities might reflect neuropathologic processes underlying the etiology of psychosis for a subgroup of patients. Psychotic disorders might also be included among the medical disorders that are considered a rule-out for tics.
Related to this, the reliability of movement assessment needs to be improved, and this may require more training for mental health professionals in movement symptoms. Although standardized assessment of movement and neurological abnormalities is common in research settings, it has been proposed that an examination of neuromotor signs should figure in the assessment of any patient, and be as much a part of the patient assessment as the mental state examination (Picchioni and Dazzan, 2009).
To this end it is important for researchers and clinicians to be aware of differentiating characteristics for these two classes of abnormal movement. For example, tics tend to be more complex than myoclonic twitches, and less flowing than choreoathetodic movements (Kompoliti and Goetz, 1998). Patients with tics often describe a sensory premonition or urge to perform a tic, and the ability to postpone tics at the cost of rising inner tension (Gilbert, 2006). For example, one study showed that patients with tic disorders could accurately distinguish tics from other movement abnormalities based on the subjective experience of some voluntary control of tics (Lang, 1991). Another differentiating factor derives from the relationship of the movement in question to other voluntary movements. Tics in one body area rarely occur during purposeful and voluntary movements in that same body area whereas dyskinesia are often exacerbated by voluntary movement (Gilbert, 2006). Finally, it is noteworthy that tics wax and wane in frequency and intensity and migrate in location over time, often becoming more complex and peaking between the ages of 9 and 14 years (Gilbert, 2006). In the case of dyskinesias among youth at-risk for psychosis, there is evidence that the movements tend to increase in severity and frequency as the individual approaches the mean age of conversion to schizophrenia spectrum disorders (Mittal et al., 2008).
As revisions to the DSM are currently underway in preparation for the new edition (DSM V), we encourage greater attention to the important, though often subtle, distinctions among subtypes of movement abnormalities and their association with psychiatric syndromes.
67,017 citations
Journal Article•
TL;DR: Diagnostic and statistical manual of mental disorders (DSM-5) was translated by psychiatrists and psychologists, mainly from the University psychiatric hospital Vrapce and published by the Naklada Slap publisher.
Abstract: Title: Diagnostic and statistical manual of mental disorders (DSM-5) Author: American Psychiatric Association Editors of Croatian Edition: Vlado Jukic, Goran Arbanas ISBN: 978-953-191-787-2 Publisher: Naklada Slap, Jastrebarsko, Croatia Number of pages: 936Diagnostic and statistical manual of mental disorders is a national classification, but since its third edition it became a worldwide used manual. [1] It has been published by the American Psychiatric Association and two years ago the fifth edition was released. [2] Croatian was among the first languages this book was translated to. [3] DSM-5 was translated by psychiatrists and psychologists, mainly from the University psychiatric hospital Vrapce and published by the Naklada Slap publisher.DSM has always been more publicly debated than the other main classification - the International Classification of Diseases (ICD). [4] The same happened with this fifth edition. Even before it was released, numerous individuals, organizations, groups and associations were publicly speaking about the classification, new diagnostic entities and changing criteria. [5]Although there is a tendency of authors of both DSM and ICD to synchronize these two classifications and to make them more harmonized with each new edition, there are several differences among them. While ICD covers all the diseases, disorders and reasons for making a contact with the health system, DSM covers "only" mental disorders. Other disorders (medical conditions, as they are named in DSM-5) are not included, except in situations when they lead to a development of a mental disorder. The other main difference is that DSM is more operational zed, and gives criteria for each of the disorders, listing how many criteria have to be met to make a diagnosis of a particular disorder, and what excluding criteria are.Due to the fact that it is used all around the globe and since it has become the most used psychiatric manual, it is sometimes said that DSM is a "psychiatric Bible". [6]Some critics of DSM say that it stigmatizes people and that in each edition it includes more diagnostic entities. It is true that in each edition of DSM there are more disorders listed, but this is due to the fact that medicine is a developing area and new insights are made every year, so some disorders are separated into different subtypes or subgroups and different new diagnoses, giving the impression more behaviour are being pathologized. The intention of the authors was to make more homogenous groups. But, the truth is that, compared with ICD, it is more difficult to get a diagnosis in DSM, than in ICD, with the same clinical presentation. [7] DSM requires functional impairment or distress to pathologize behaviour, while in ICD this criterion is not present in every case.During the process of developing DSM-5 there was an open public discussion. [2] For over a year any person was able to participate in the discussion about future criteria, inclusion or exclusion of diagnostic entities from DSM. More than 21000 letters was sent to the authors. This was the unprecedented way of developing a classification that ICD now tries to follow in preparation of its 11th edition.As a direct consequence of such an open and wide discussion, some new disorders were included (e.g. hoarding disorder), some were excluded even though they were included during the proposal period (e.g. hypersexual disorders), some were heavily debated (e.g. narcissistic personality disorder). [8-10]As previously mentioned, DSM and ICD systems try to harmonize more. There were more non-American authors included in DSM-5 than ever before and some of the experts in the field were in the task force of DSM-5 and ICD-11. [2, 11]What is new in DSM-5, compared to DSM-IV. The organization of the chapters has been changed, so now the flow of the disorders follow life cycle. The book starts with neurodevelopmental disorders, followed by schizophrenia, bipolar and depressive disorders, and closing with neurocognitive disorders. …
15,478 citations
TL;DR: In this paper, the authors discuss the discounted utility (DU) model, its historical development, underlying assumptions, and "anomalies" -the empirical regularities that are inconsistent with its theoretical predictions.
Abstract: This paper discusses the discounted utility (DU) model: its historical development, underlying assumptions, and "anomalies" - the empirical regularities that are inconsistent with its theoretical predictions. We then summarize the alternate theoretical formulations that have been advanced to address these anomalies. We also review three decades of empirical research on intertemporal choice, and discuss reasons for the spectacular variation in implicit discount rates across studies. Throughout the paper, we stress the importance of distinguishing time preference, per se, from many other considerations that also influence intertemporal choices.
5,242 citations
"Financial Literacy and Gambling Beh..." refers background in this paper
...Moreover, the inclusion of smoking and alcohol consumption could have a collinear relationship (Grucza and Bierut 2006)....
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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 paper, individual discount rates for losses and gains were estimated from survey evidence and they were found to vary inversely with the size of the reward and the length of time to be waited.
2,141 citations
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