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The role of national culture in financial literacy: Cross‐country evidence
Author(s) -
De Beckker Kenneth,
De Witte Kristof,
Van Campenhout Geert
Publication year - 2020
Publication title -
journal of consumer affairs
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.582
H-Index - 62
eISSN - 1745-6606
pISSN - 0022-0078
DOI - 10.1111/joca.12306
Subject(s) - financial literacy , hofstede's cultural dimensions theory , uncertainty avoidance , individualism , socialization , literacy , political science , economics , sociology , finance , economic growth , social science , collectivism , market economy
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.