Gender Differences in Financial Literacy: Evidence from India

Abstract

In this paper, we use new and unexploited data on financial literacy among high school students in Italy. The Program for International Student Assessment (PISA) provided a unique set of data that allows researchers to analyze financial literacy among this important population group. Italy is an interesting country to study, as Italian students not only score particularly low on the financial literacy assessment but also show a strong and significant gender difference. We are able to document the impact of the family, in particular the mother, on the financial knowledge of girls. The environment in which girls and boys live also plays a role in explaining regional differences in the gender gap. Moreover, history matters: medieval commercial hubs created favorable preconditions for the transformation of the role of women in society, and in those regions today, we see higher financial literacy among youths. Although we cannot completely explain the gender difference in financial literacy, we can certainly show how factors affect boys and girls differently.