TY - JOUR

T1 - Saving behavior and financial literacy of Russian high school students

T2 - An application of a copula-based bivariate probit-regression approach

AU - Gilenko, Evgenii

AU - Chernova, Aleksandra

N1 - Gilenko, E. Saving behavior and financial literacy of Russian high school students: An application of a copula-based bivariate probit-regression approach / E. Gilenko, A. Chernova, // Children and Youth Services Review. - 2021. - Volume 127.

PY - 2021/8

Y1 - 2021/8

N2 - Understanding of the determinants of saving behavior of people is important for securing the financial stability of both the person, individually, and the country, at large. The commonly accepted viewpoint here is that a higher level of financial literacy (as brought by the relevant economic education via, in particular, smarter saving) leads to increasing of financial well-being. But, as we discuss in this paper by providing an appropriate conceptual theoretical framework, this relation has a more complicated nature: in some cases, financial literacy may have an adverse effect on people's financial well-being. To secure the positive effect of financial literacy on financial well-being, specifically, via saving more actively, the appropriate programs should be introduced at the early stages of education (e.g., at school). This study aims to appropriately assess the magnitude of influence of the fact of being financially literate on the fact of making savings. To this end, we use a representative sample (n = 1,243) of Russian high school students. In order to account for the endogenous nature of the influence of financial literacy on the willingness to make savings, we employ a copula-based bivariate probit-regression approach to identify the actual magnitude of this influence. To the best of our knowledge, we are the first to apply a copula-based modeling to this problem. As a result, for the considered cohort of Russian adolescents, we demonstrate that the studied magnitude is substantially greater when the endogeneity effect is appropriately controlled for. We also reveal and discuss the factors that impact the level of financial literacy and saving behavior of a Russian teenager. Relevant recommendations are provided for Russian financial authorities and institutions.

AB - Understanding of the determinants of saving behavior of people is important for securing the financial stability of both the person, individually, and the country, at large. The commonly accepted viewpoint here is that a higher level of financial literacy (as brought by the relevant economic education via, in particular, smarter saving) leads to increasing of financial well-being. But, as we discuss in this paper by providing an appropriate conceptual theoretical framework, this relation has a more complicated nature: in some cases, financial literacy may have an adverse effect on people's financial well-being. To secure the positive effect of financial literacy on financial well-being, specifically, via saving more actively, the appropriate programs should be introduced at the early stages of education (e.g., at school). This study aims to appropriately assess the magnitude of influence of the fact of being financially literate on the fact of making savings. To this end, we use a representative sample (n = 1,243) of Russian high school students. In order to account for the endogenous nature of the influence of financial literacy on the willingness to make savings, we employ a copula-based bivariate probit-regression approach to identify the actual magnitude of this influence. To the best of our knowledge, we are the first to apply a copula-based modeling to this problem. As a result, for the considered cohort of Russian adolescents, we demonstrate that the studied magnitude is substantially greater when the endogeneity effect is appropriately controlled for. We also reveal and discuss the factors that impact the level of financial literacy and saving behavior of a Russian teenager. Relevant recommendations are provided for Russian financial authorities and institutions.

KW - SCOPUS

KW - Copula-based bivariate probit-regression

KW - Economics education

KW - Financial literacy

KW - High school students

KW - Saving behavior

KW - EXPERIENCES

KW - WOMEN

KW - IMPACT

KW - NONCOGNITIVE ABILITIES

KW - MODELS

KW - ADOLESCENTS

KW - EDUCATION

UR - http://www.scopus.com/inward/record.url?scp=85108297428&partnerID=8YFLogxK

UR - https://www.mendeley.com/catalogue/c0721eed-4762-3d70-aa0b-38a10d71ec77/

U2 - 10.1016/j.childyouth.2021.106122

DO - 10.1016/j.childyouth.2021.106122

M3 - Article

AN - SCOPUS:85108297428

VL - 127

JO - Children and Youth Services Review

JF - Children and Youth Services Review

SN - 0190-7409

M1 - 106122

ER -