The role of national culture in financial literacy: Cross‐country evidence

This paper examines the effect of national culture on adult financial literacy levels in 12 countries. Contrary to earlier financial literacy studies, our results are directly comparable across countries given that we use the standardized OECD/INFE financial literacy survey data and Hofstede's,...

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Bibliographic Details
Published inThe Journal of consumer affairs Vol. 54; no. 3; pp. 912 - 930
Main Authors De Beckker, Kenneth, De Witte, Kristof, Van Campenhout, Geert
Format Journal Article
LanguageEnglish
Published Malden, USA Wiley Periodicals, Inc 01.10.2020
Blackwell Publishing Ltd
Subjects
cross‐country analysis
Culture
Financial literacy
Individualism
International finance
Literacy
national culture
Socialization
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Summary:This paper examines the effect of national culture on adult financial literacy levels in 12 countries. Contrary to earlier financial literacy studies, our results are directly comparable across countries given that we use the standardized OECD/INFE financial literacy survey data and Hofstede's, 2001, cultural dimensions to capture financial literacy and national culture. In line with the financial socialization theory, we find that uncertainty avoidance positively influences financial literacy, while individualism negatively influences financial literacy. We conclude that national culture affects financial literacy and that it is important to account for cultural dimensions in future international financial literacy research.
Bibliography:The OECD/INFE data used in this publication have been provided by the authorities of the participating countries. This publication does not constitute an official statement by or represent the views of these institutions.
Funding information
EUfin project , Grant/Award Number: 2018‐1‐BE02‐KA203‐046843; Wikifin.be (Financial Services and Markets Authority (FSMA) ‐ Belgium)
The views expressed in this publication are the sole responsibility of the author and do not necessarily reflect the views of the European Commission. Neither the European Commission nor any person acting on behalf of the Commission is responsible for the use which might be made of the following information.
For insightful comments and suggestions, we thank Hans Knapen, Els Lagrou, Vanessa Naegels, and Danièle Vander Espt.
ISSN:0022-0078
1745-6606
DOI:10.1111/joca.12306