Deuflhard, F., Georgarakos, D. and Inderst, R. (2019) Financial literacy and savings account returns. Journal of the European Economic Association, 17(1), pp. 131-164. (doi: 10.1093/jeea/jvy003)
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Abstract
Savings accounts are owned by most households, but little is known about the performance of households’ investments. We create a unique dataset by matching information on individual savings accounts from the DNB Household Survey with market data on account-specific interest rates and characteristics. We document heterogeneity in returns across households, which can be partly explained by financial sophistication. A one-standard deviation increase in financial literacy is associated with a 12% increase compared to the median interest rate. We isolate the usage of modern technology (online accounts) as one channel through which financial literacy has a positive association with returns.
| Item Type: | Articles |
|---|---|
| Status: | Published |
| Refereed: | Yes |
| Glasgow Author(s) Enlighten ID: | Georgarakos, Professor Dimitris |
| Authors: | Deuflhard, F., Georgarakos, D., and Inderst, R. |
| College/School: | College of Social Sciences > Adam Smith Business School > Economics |
| Journal Name: | Journal of the European Economic Association |
| Publisher: | Oxford University Press |
| ISSN: | 1542-4766 |
| ISSN (Online): | 1542-4774 |
| Published Online: | 23 April 2018 |
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