Financial Education Affects Financial Knowledge and Downstream Behaviors

About the working paper

This working paper, co-authored by Tim Kaiser, Annamaria Lusardi, Lukas Menkhoff, and Carly Urban, and published in April 2020, studies the rapidly growing literature on the causal effects of financial education programmes in a meta-analysis of 76 randomised experiments with a total sample size of over 160,000 individuals.

The evidence shows that financial education programs have, on average, positive causal treatment effects on financial knowledge and downstream financial behaviours. Treatment effects are economically meaningful in size, similar to those realised by educational interventions in other domains and are at least three times as large as the average effect documented in earlier work.

These results are robust to the method used, restricting the sample to papers published in top economics journals, including only studies with adequate power, and accounting for publication selection bias in the literature. The paper concludes with a discussion of the cost-effectiveness of financial education interventions.

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