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Financial Education and Timely Decision Support: Lessons from Junior Achievement

By Ian Carlin, David T. Robinson and Doug Bernheim


Financial literacy is defined as “the ability of people to make financial decisions in their own best short- and long-term interests” (Mandell, 2008). Unfortunately, this skill is in short supply, which may erode both personal and aggregate welfare (e.g., Lusardi and Mitchell, 2007). To date, three main avenues of research have been proposed to address this scarcity: (1) directly improving education (e.g., Bernheim, Garrett, and Maki, 2001); (2) improving access to timely decision support (Lynch, 2009); or (3) implementing judicious default options to limit the harm that people can do by not making an informed choice (Thaler and Sunstein, 2003). The primary goal of this paper is to study the interaction between the first two approaches described above. Namely, we explore how the uptake of timely decision support is impacted by previous exposure to financial education. To study this problem, we exploit the peculiar features of a training program developed by Junior Achievement. Our subjects are 2,357 Los Angeles students aged 13-19 years old who participated in a simulated consumer finance experience at the Junior Achievement Finance Park of Southern California during the 2008-2009 academic year. The Finance Park is a sim

Year: 2012
DOI identifier: 10.1257/aer.102.3.305
OAI identifier: oai:CiteSeerX.psu:
Provided by: CiteSeerX
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