Wealth and the Acquisition of Financial Literacy


Monticone, C. (2010). How much does wealth matter in the acquisition of financial literacy? The Journal of Consumer Affairs, 44 (2), 403-422.

Brief Description: This article investigated the determinants of financial literacy in Italy using the 2006 wave of the Italian survey on household income and wealth. Empirical results indicated that wealth has a positive effect on financial literacy, suggesting that households endowed with larger financial assets are more likely to invest in financial knowledge.

Implications: an implication for policymakers is that active measures are needed to create a financially responsible workforce in Italy. Educational initiatives should be directed especially at the young – because due to recent pension reforms they have a greater need to build their own retirement wealth, and hence a greater need for an improved financial knowledge – and the poor – because they are less likely to acquire some knowledge by themselves. Greater information disclosure and transparency by financial institutions would also be desirable.