Numeracy

Advancing Education in Quantitative Literacy

Volume 11 | Issue 2 Article 5

2018

The Connection between Financial Literacy and

Numeracy: A Case Study from India
J.D Jayaraman
New Jersey City University, [email protected]
Saigeetha Jambunathan
New Jersey City University, [email protected]
Kenneth Counselman
New Jersey City University, [email protected]

Follow this and additional works at: http://scholarcommons.usf.edu/numeracy

Part of the Finance and Financial Management Commons, and the Science and Mathematics
Education Commons

Recommended Citation
Jayaraman, J.D, Saigeetha Jambunathan, and Kenneth Counselman. "The Connection between Financial Literacy and Numeracy: A
Case Study from India." Numeracy 11, Iss. 2 (2018): Article 5. DOI: https://doi.org/10.5038/1936-4660.11.2.5

Authors retain copyright of their material under a Creative Commons Non-Commercial Attribution 4.0 License.
The Connection between Financial Literacy and Numeracy: A Case Study
from India
Abstract
Making financial decisions involves mathematical calculations, both simple and complex. It is a well-
documented fact that financial literacy levels among young people all over the world are quite low and that
these low levels contribute to various undesirable outcomes with respect to personal financial well-being and
the economy as a whole. This study explores the relationship between financial literacy and numeracy by
measuring and modeling the relationship between financial literacy and numeracy levels among high school
students (N = 586) in India. The results show a strong relationship between numeracy and financial literacy
skills. Low numeracy is associated with a 4.8% reduction in financial literacy, while a high level of numeracy is
associated with a 5.6% increase. This relationship is robust and held even when controlling for factors
including gender, grade, education stream, level of financial education, language of instruction, parental
involvement, parental education, family income, and future education plans. Because there is a strong
relationship between numeracy and financial literacy, educational policy should consider increasing numeracy
skills as one of the means of improving financial literacy. In particular numeracy as it relates to financial
literacy (e.g., interest calculations, chart/data comparisons, and interpretations) should be promoted as part of
the curriculum.

Keywords
financial literacy, numeracy and financial literacy, financial education, India, developing countries, quantitative
literacy, quantitative literacy

Creative Commons License

This work is licensed under a Creative Commons Attribution-Noncommercial 4.0 License

Cover Page Footnote

Dr. J.D Jayaraman is an Associate Professor of Finance and Data Science at the New Jersey City University
School of Business. He has over fifteen years of experience on Wall Street and over eight years of experience
teaching finance. His primary research interests are in improving financial literacy among young people. More
specifically, his work examines the use of innovative teaching methods and cutting edge technology to engage
students and improve learning of personal finance. Dr. Saigeetha Jambunathan is a professor of Early
Childhood Education at New Jersey City University with over twenty years of experience. Her research
interest is in the areas of developmentally appropriate practices in early childhood classrooms, teacher beliefs
about the use of developmentally appropriate practices, cross-cultural comparisons of parenting attitudes, and
children’s perception of self-competence. More recently, Dr. Jambunathan has also started research on
financial literacy among early childhood educators and factors that prevent them from teaching financial
literacy concepts in their classrooms. Dr. Kenneth Counselman is an Associate Professor of Early Childhood
Education at New Jersey City University with over 40 years of experience as an educator. His research
interests are in the area of developmentally appropriate practices, multi-modal methods of teaching and
learning, and use of block play to promote math skills in early childhood classrooms. He has served on the
governing board for many accreditation organizations.

This article is available in Numeracy: http://scholarcommons.usf.edu/numeracy/vol11/iss2/art5

 Jayaraman et al.: The Connection between Financial Literacy and Numeracy

Introduction
Making financial decisions requires performing a variety of calculations, some
fairly complex. The President's Advisory Committee on Financial Literacy
(PACFL) defines personal financial literacy as “the ability to use knowledge and
skills to manage financial resources effectively for a lifetime of financial well-
being” (PACFL 2008). One of the key skills required to manage one’s financial
resources effectively is the ability to do basic mathematical calculations, such as
percentages, and more sophisticated calculations, such as computing compound
interest.
Many studies around the world have found low levels of financial literacy
among people of all ages. The 2015 Program for International Student Assessment
(PISA) survey of 15 year olds found financial literacy to be low in many of the 34
Organization for Economic Cooperation and Development (OECD) countries, with
financial literacy in the United States below the OECD average (OECD 2017). The
PISA study found that 22% of all students surveyed do not have basic financial
skills and only 12% of students are able to handle fairly difficult financial tasks
(OECD 2017). Borodich et al. (2010) compared the financial literacy of high school
students in Japan, the United States, and Belarus and found that the Japanese
students fared much better than their peers in the other two countries. Cameron et
al. (2013) found similar results when they compared the personal financial literacy
of high school students in New Zealand, the United States, and Japan: though all
three countries fared poorly, Japan fared better than the others. Thus, low levels of
financial literacy is a worldwide problem.
The gender gap in financial literacy among high school students is another area
of concern. Many studies have found significant gender differences in financial
literacy of high school students with males outperforming females (e.g., Varcoe et
al. 2005; Danes and Haberman 2007; Hanna et al. 2010; Butters and Asarta 2011;
Butters et al. 2012). However, Walstad et al. (2010) find no significant gender
differences in financial literacy among high school students after participating in
an intervention program, which is an encouraging sign that the gender gap can be
closed by financial education.
Lack of financial literacy has been linked to making bad financial decisions
that impacts one’s future (Cole et al. 2011). Low levels of financial literacy prevent
people from planning for retirement (Lusardi and Mitchell 2007b), increase the cost
of borrowing (Stango and Zinman 2009), lead people to accumulate less wealth
(Lusardi and Mitchell 2007a), and lower stock market participation (Van Rooij et
al. 2011). Similarly, de Bassa Scheresberg (2013) find that young Americans with
higher confidence in their financial literacy and math knowledge did not borrow at
high interest rates, planned for retirement, and saved for emergencies. Thus, the

Published by Scholar Commons, 2018 1

 Numeracy, Vol. 11 [2018], Iss. 2, Art. 5

economic impact of financial illiteracy is significant. A simulation study of a life

cycle model of financial literacy finds that lack of financial literacy can explain
close to half of the wealth inequality that exists in the United States (Lusardi et al.
2017). Despite the compelling evidence, many countries have not taken any
substantial steps to educate and empower students with appropriate financial
education. According to the 2015 report by the Center for Financial Literacy at
Champlain College on how high schools in the United States are providing financial
literacy education, of the 50 states only 10% received a letter grade of A, 39%
received a B, 22% received a C, 6% received a D and 24% received an F. 1 This
report also details reasons for the low grades: poor teacher training, lack of
appropriate curriculum and teaching strategies, lack of accountability in financial
literacy education in terms of having appropriate assessments, lack of funding to
develop curriculum and teacher training, and not looking at financial literacy
holistically and integrating it across the curriculum. Thus, it is evident from the
literature that financial education and financial literacy need to be improved
drastically and hence the need for researchers to investigate effective means of
improving financial literacy.
Numeracy is mathematical content embedded in real world contexts and is
applied in particular situations (Shavelson 2008). Several studies have attempted to
measure numeracy and its relationship to financial literacy. The numeracy that we
are concerned with and which is measured in the financial literacy literature,
focuses on simple mathematical skills that are needed for everyday financial
calculations. Lusardi and Mitchell (2011) designed questions to measure numeracy
and financial literacy that were included in the 2004 Health and Retirement Study
(HRS) in the United States. Based on the 2004 HRS survey data the authors found
low levels of numeracy, in addition to low levels of financial literacy, among older
Americans (age 50 and older). Gerardi et al. (2010) find that these numeracy gaps
are correlated with poor financial decision making. When asked to answer five
numeracy questions, only 13% of subprime-mortgage borrowers answered all
correctly.
These problems are not limited to the United States. The English Longitudinal
Study on Aging reports that only 11% of the respondents in the United Kingdom
correctly answered all five numeracy questions (Banks and Oldfield 2007). (These
questions were also used by Gerardi et al. [2010] cited above.) Numeracy has been
found to be low in many countries in Europe, with Germany, the Netherlands, and
Sweden being among the highest and Italy and Spain being among the lowest
(Christelis et al. 2010). In all of these studies, the questions requiring numerical

1
http://www.champlain.edu/centers-of-excellence/center-for-financial-literacy/report-making-the-
grade/the-case-for-high-school-financial-literacy

http://scholarcommons.usf.edu/numeracy/vol11/iss2/art5 2
DOI: https://doi.org/10.5038/1936-4660.11.2.5
 Jayaraman et al.: The Connection between Financial Literacy and Numeracy

calculations for performing simple interest computations came out to be the ones
that were answered incorrectly by most.
Lack of financial literacy and numeracy with respect to financial calculations
among high school students and college students is of particular concern. Young
people are confronted with making many tough financial decisions and are
inadequately prepared to make these decisions due to lack of financial literacy.
Lack of financial literacy then can lead to undesirable outcomes such as excessive
debt, loan default, and personal bankruptcy.
Because the level of financial literacy and numeracy is low in most countries,
it is important to study whether there is a relationship between numeracy and
financial literacy. If there is a clear relationship between the two, then policies could
be put in place to focus on increasing numeracy skills as a means of improving
financial literacy. Moreover, almost all of the studies measuring numeracy and
financial literacy have been conducted in developed countries in North America
and Europe. Cole et al. (2011), a notable exception, report low levels of both
financial literacy and basic mathematics competency in India and Indonesia. This
lack of evidence makes the study of numeracy and its relationship to financial
literacy even more important in developing countries. To the best of the author’s
knowledge there are no studies measuring numeracy in a developing country as it
relates to financial literacy and exploring the relationship between them. This study
investigates the relationship between financial literacy and numeracy among high
school students in India. Thus, this study is among the first to shed light on the
relationship between numeracy and financial literacy in a Southeast Asian country,
India, which has very different cultural beliefs with respect to saving and retirement
as compared to western countries.

The Indian Education System

Because our research sample is from India, a brief description of the Indian
education system is provided for context. The secondary school system in India
consists of ninth and tenth grades (students 14 to 15 years old), typically referred
to as secondary school, and eleventh and twelfth grades (students 16 to 17 years
old), typically referred to as higher secondary school. Higher secondary school
attendance is required of students if they are college bound. Schools are run either
by the government (central/state/local) or by private institutions. There are various
education curriculums that schools follow; the most prominent of these are the
Central Board of Secondary Education (CBSE) curriculum, Council of Indian
School Certificate Examinations (CISCE) curriculum, and State Government
Board curriculum. The medium of instruction in all schools is either English or the
local language, which varies from state to state. The medium of instruction in

Published by Scholar Commons, 2018 3

 Numeracy, Vol. 11 [2018], Iss. 2, Art. 5

government-run schools tends to be the local language while the medium of

instruction in private schools is largely English.
The 9th and 10th grade curriculum includes instruction in the following content
areas: three Languages (English, the local language in the state, and another
language), social studies, science and technology, math, vocational education, art,
and physical education. The mathematics content taught in these two grades
consists of arithmetic concepts, number systems, algebra, geometry, trigonometry,
statistics, measurements, graphs, and coordinate geometry. At the higher secondary
school, after 10th grade, students choose between either the commerce stream or
the science stream. Students in the commerce stream predominantly study subjects
such as economics, accounting, and mathematics, while students in the science
stream study subjects such as physics, chemistry, biology, and mathematics. The
mathematics curriculum is the same for both streams. The mathematics curriculum
at the higher secondary level includes the following concepts: sets and functions,
algebra, coordinate geometry, calculus, mathematical reasoning, statistics and
probability, relations and functions, vectors, and three-dimensional geometry. The
position paper by the focus group on teaching mathematics, published by the
National Council of Educational Research and Training (NCERT) in 2005,
elaborates on many issues related to teaching math in the higher secondary grades
in India, the most important of which are the benefits of breadth versus depth in
mathematical concepts. The math curriculum in the 11th grade has more breadth
while the one in the 12th grade has more depth, particularly in the calculus area.
This arc in the curriculum is designed to prepare the students for the board exams
and a variety of college entrance exams (NCERT 2005).
India has enacted several reforms in recent years to make education accessible
to all children and to improve quality. However, teacher quality continues to be a
challenge due to inadequate training, absenteeism, and other systemic difficulties
(Beteille 2009). NCERT (2005) also raises concerns about the qualifications and
dispositions of math teachers. In particular, they raise concerns about the ability of
the math teachers to teach outside of traditional textbook instruction, helping
students apply what they have learned in the class to the real world, and
generalizing their math knowledge in other content areas, as well.

Methods
Survey Design
In the literature, financial literacy is measured by either a performance test or a self-
assessment or both (Huston 2010; Hung et al. 2009). Performance tests measure
knowledge in various financial literacy domains such as savings, investments and
debt, while self-report tests ask participants to rate themselves on their perceived
knowledge in financial literacy domains.

http://scholarcommons.usf.edu/numeracy/vol11/iss2/art5 4
DOI: https://doi.org/10.5038/1936-4660.11.2.5
 Jayaraman et al.: The Connection between Financial Literacy and Numeracy

Numeracy as it relates to financial literacy has been measured in the literature

using survey questions. Lusardi and Mitchell (2007a) used three questions from the
2004 U.S. Health and Retirement Study (HRS) that test basic numeracy in order to
assess the impact of numeracy on financial decision-making by early baby
boomers. The baby boomers surveyed were in the age range 51-56 at the time of
the survey and the financial decision-making surveyed was in the context of
retirement planning. The English Longitudinal Study on Aging (Banks and Oldfield
2007) used the same three questions as Lusardi and Mitchell (2007a) and an
additional two questions to measure numeracy.
The survey used in this study measures numeracy with two questions from
Lusardi and Mitchell (2007a) and one question from Lusardi and Mitchell (2017).2
The complete survey is shown in Table 1 and the questions are labelled for easy
reference in the text. The first numeracy question (N1) assesses knowledge of
percentage calculation, the second question (N2) tests knowledge of division, and
the third question (N3) assesses knowledge of numerical calculations in the context
of interest computation. (In these and subsequent items, questions were altered to
reflect the Indian context by changing currency units and names.) The three
questions used in our survey were not intended to measure the overall numerical
capabilities of the children. Instead, they were meant to measure the key aspects of
numeracy (such as percentages) that are needed for financial calculations. This
three question survey, despite being brief, has been used as a measure of numeracy
in prior literature (e.g., Lusardi and Mitchell 2007a).
Financial literacy in four domains—compound interest/inflation, investing,
borrowing, and insurance—was measured using 17 questions. The compound
interest/inflation section (C1 - C4) uses the four basic financial literacy questions
in Lusardi and Mitchell (2017). The first question (C1) in the compound interest
section is similar to the third question (N3) in the numeracy section but with added
wording to indicate that the interest earned is left in the account, thus suggesting
that this interest amount will earn additional interest (interest on interest). The
investing section (I1 - I8) is comprised of the eight sophisticated financial literacy
questions used in Lusardi and Mitchell (2017). The borrowing section (B1 - B3)
uses one question from the Financial Industry Regulatory Authority 2009 National
Financial capability Study and two questions from the Jump$tart survey.3 The
insurance section (S1 - S2) uses one question from Chen and Volpe (1998) and one
question from the Jump$tart survey. The survey does not attempt to measure all
possible aspects of financial literacy because that would be overly long and

2
Permission has been received from all the authors to use their financial literacy and numeracy
survey questions in our research and to print them in any publications.
3
http://www.usfinancialcapability.org/ and http://jumpstart.org/survey.html

Published by Scholar Commons, 2018 5

 Numeracy, Vol. 11 [2018], Iss. 2, Art. 5

Table 1
Financial Literacy and Numeracy Survey Questions
Label Question
Numeracy
N1 If the chance of getting a disease is 10 percent, how many people out of 1,000 would be expected to get the
disease?
a. 100 b. 90 c. 10
N2 If 5 people all have the winning number in the lottery and the prize is 20 lakh rupees, how much will each of
them get?
a. ₹2,00,000 b. ₹4,00,000 c. ₹1,00,000
N3 Suppose you had ₹100 in a savings account and the interest rate was 2 percent per year. After 5 years, how
much do you think you would have in the account if you left the money to grow:
a. more than ₹102 b. exactly ₹102 c. less than ₹102
Compound Interest and Inflation
C1 Suppose you had ₹1000 in a savings account and the interest rate is 20 percent per year and you never withdraw
money or interest payments. After 5 years, how much would you have in the account in total:
a. more than ₹2000 b. exactly ₹2000 c. less than ₹2000
C2 Imagine that the interest rate on your savings account was 1 percent per year and inflation was 2 percent per
year. After 1 year, would you be able to buy:
a. more than today with the money in this account
b. exactly the same as today with the money in this account
c. less than today with the money in this account
C3 Assume a friend inherits ₹10,000 today and his brother inherits ₹10,000 three years from now. Who is richer
because of the inheritance?
a. My friend b. His brother c. They are equally rich
C4 Suppose that in year 2020 your income has doubled, and the prices of all goods have doubled too. In 2020 how
much will you be able to buy with your income?
a. more than today b. The same c. Less than today
Investing
I1 Which of the following statements describes the main function of the stock market?
a. The stock market helps to predict stock earnings
b. The stock market results in the increase in the price of the stocks
c. The stock market brings people who want to buy stocks together with those who want to
sell stocks
d. None of the above
I2 Do you think that the following statement is true or false? “Buying a single company stock usually provides a
safer return than a stock mutual fund.”
a. True b. False
I3 Which of the following statements is correct?
a. Once one invests in a mutual fund, one cannot withdraw the money in the first year
b. Mutual funds can invest in several assets, for example, can invest in both stocks and
bonds
c. Mutual funds pay a guaranteed rate of return based on their past performance
d. None of the above
I4 If interest rates rise, what will typically happen to bond prices?
a. They will rise
b. They will fall
c. They will stay the same
d. There is no relationship
I5 True or False? “Stocks are normally riskier than bonds”
a. True b. False
I6 Considering a long period (e.g. 10 or 20 years) which asset normally gives the highest return?
a. Saving accounts b. Bonds c. Stocks
I7 Normally which asset displays the highest fluctuations over time?
a. Savings accounts b. Bonds c. Stocks
I8 When an investor spreads his money among different assets, does the risk of losing money:
a. Increase b. Decrease c. Stay the same

http://scholarcommons.usf.edu/numeracy/vol11/iss2/art5 6
DOI: https://doi.org/10.5038/1936-4660.11.2.5
 Jayaraman et al.: The Connection between Financial Literacy and Numeracy

Table 1 (cont.)
Financial Literacy and Numeracy Survey Questions
Label Question
Borrowing
B1 A 15-year housing loan typically requires higher monthly payments than a 30-year housing loan but the total
interest over the life of the loan will be less.
a. True b. False
B2 Vijay and Mohan are young men with good credit histories. Vijay has borrowed ₹60,000 to take a foreign
vacation while Mohan has borrowed ₹60,000 to buy a car. Who is likely to pay the lower finance charge?
a. Mohan will pay less because the car is collateral for the loan
b. They will both pay the same because the interest rate is set by law
c. Vijay will pay less because people who travel overseas have less risk of not repaying
the loan
d. They will both pay the same because they have similar financial backgrounds
B3 Which of the following credit card users will pay the maximum amount in finance/interest charges per year?
a. Raman, who always pays off his credit card bill in full each month
b. Ajith, who only pays the minimum amount each month
c. Lakshmi, who pays at least the minimum amount each month and more when she can
afford it
d. Kavitha, who usually pays her bill in full but occasionally pays the minimum amount
Insurance
S1 The main reason for purchasing insurance is to
a. Protect you from a loss that recently occurred
b. Provide you with good investment returns
c. Protect you from sustaining a catastrophic loss
d. Protect you from small incidental losses
S2 If each of the following persons have the same amount of take home pay, who would need the greatest amount
of life insurance?
a. An elderly man with a wife who is also retired
b. A young married man without children
c. A young single woman with two young children
d. A young single woman without children
Demographics
D1 Gender: a. Male b. Female
D2 Grade: a. 10th b. 11th c. 12th
D3 Education Stream: a. Commerce b. Science
D4 What is the highest level of schooling your father or mother has completed
a. No schooling
b. Neither completed high school
c. Completed high school
d. Some college
e. College graduate or more than college
D5 What are your educational plans after high school?
a. No further education is planned
b. Attend a 2 year college or Junior college
c. Attend a 4 year college or university
d. Vocational training
D6 Approximately on an average what do you score on your mathematics exams
a. Under 30%
b. 30% - 50%
c. 50% - 75%
d. 75% - 90%
e. Above 90%
D7 Which best describes your family’s annual income
a. Less than ₹1,00,000
b. Between ₹1,00,000 and ₹3,00,000
c. Between ₹3,00,000 and ₹5,00,000
d. Above ₹5,00,000
D8 On a scale of 1 to 7, 1 being very low and 5 being very high, how would you assess your understanding of
economics and finance?
a. 1 b. 2 c. 3 d. 4 e. 5

Published by Scholar Commons, 2018 7

 Numeracy, Vol. 11 [2018], Iss. 2, Art. 5

Table 1 (cont.)
Financial Literacy and Numeracy Survey Questions
Label Question
D9 How much of your school education has been devoted to economics and/or finance?
a. None
b. Very little
c. Some
d. A lot
D10 What financial matters do your parents discuss with you?
a. Saving
b. Borrowing
c. Investing
d. My parents discuss all or some of the above with me
e. My parents do not discuss any financial matters with me

logistically difficult to administer. Consequently, we picked the four important

domains of financial literacy that have been consistently measured in extant
literature. The questions used in our survey to assess financial literacy and
numeracy have been widely used in the literature and have also been used in large-
scale government studies.
The “do not know/refuse to answer” response option was removed from the
original questions in line with other studies such as the Jump$tart survey (Mandell
2008) and that of Erner et al. (2016) which use the same basic (C1 – C3) and
sophisticated (I1 – I8) financial literacy questions as in our survey. While there are
pros and cons to including a “do not know” option in surveys, in recent years the
scientific consensus has shifted towards omitting the “do not know” option.
Krosnick (1991 argues that answering survey questions requires cognitive work and
that the “do not know” option gives respondents a way to avoid this cognitive work.
Krosnick et al. (2002) find that including the “do not know” option did not improve
data quality and that respondents would have provided substantive answers if the
option was not included.
Our survey also asks for demographic information and self-assessment
information as specified in questions D1 – D10 in Table 1.
Sample
We constructed a purposive sample. The survey was conducted in two southern
Indian cities, Chennai and Madurai, in the state of Tamilnadu. Chennai is the capital
of Tamilnadu, and Madurai is the second largest city in Tamilnadu. The survey was
given to 620 high school students in grades 10, 11 and 12 in three schools. All of
the students in the three grades participated in the survey. The three schools were
selected based upon the authors’ relationship with the school administration and
their willingness to participate in the study. Two of the schools were single-gender
(female) schools located in Chennai and the other was a coeducational school
located in Madurai. The survey was translated in the local language, Tamil, for two
of the schools where the medium of instruction was Tamil. The third school’s

http://scholarcommons.usf.edu/numeracy/vol11/iss2/art5 8
DOI: https://doi.org/10.5038/1936-4660.11.2.5
 Jayaraman et al.: The Connection between Financial Literacy and Numeracy

medium of instruction was English. These two Tamil-medium schools were the all-
girls schools. The girls in these schools were from a lower socioeconomic status,
while the students from the English-medium school were from middle- and upper-
socio-economic status. We excluded 34 participants due to incomplete data
resulting in a sample of N = 586. Our sample consisted of 457 females and 129
males. Among these, 331 students were pursuing the commerce stream and 255
students were pursuing the science stream. At the time of the survey, 162 students
were in the 10th grade, 261 in grade 11, and 163 in grade 12. The students ranged
in age from 14 to 18 years old.
The surveys were administered to the students by their teachers in the school,
during school hours. The use of calculators was not allowed. The researchers were
present in the school when the surveys were being administered to answer any
questions that might arise. The teachers were instructed not to help the children
with answering the questions. We set no time limit for answering the survey, but
all students completed the survey within 20 minutes. No incentives were provided
for completing the survey.
Analysis
Percentage correct scores (PCS), defined as the number of correct answers divided
by the total number of questions, were examined in our analysis. This methodology
is consistent with many other studies on financial literacy (e.g., Mitchell 2009 and
Lusardi and Erner et al. 2016). There are four subscales in the financial literacy
survey: basic financial literacy (compound interest/inflation), sophisticated
financial literacy (investing), borrowing, and insurance. Mean PCS for each of the
financial literacy subscales were computed to provide a measure of basic financial
literacy, sophisticated financial literacy, and knowledge of both borrowing and
insurance.
The reliability (Cronbach’s Alpha) of the financial literacy section of the
survey was 0.73 and the reliability of the numeracy section of the survey was 0.69.
The reliability of our survey questions were further examined by looking at the
pairwise correlation between the items. The correlations ranged from 0.27 to 0.79
for the financial literacy section of the survey and 0.39 to 0.72 for the numeracy
section of the survey. The questions used in our survey, especially the basic
financial literacy questions (C1 – C3), the sophisticated financial literacy questions
(I1 – I8), and the numeracy questions (N1 – N3), have been used in numerous other
surveys over the past several years with both high school students and adults in
various countries, including Asian countries (e.g., the 2015 PISA survey of 15-
year-olds in 15 countries), and have established content validity.
The dependent variable, financial literacy, is a ratio scale variable with a wide
range (11.76% to 76.47%) and standard deviation of 13%. No values were near the
floor of zero. Hence, following many others in the literature, we treat this measure

Published by Scholar Commons, 2018 9

 Numeracy, Vol. 11 [2018], Iss. 2, Art. 5

as a continuous variable (Chen and Volpe 1998; Van Rooij et al. 2011; Erner et al.
2016; Lusardi and Mitchell 2017).
Following the approach of Erner et al. (2016), to assess the relationship
between numeracy and financial literacy after controlling for confounding
variables, we estimate a three-level linear mixed model with random intercepts for
school and grade:

𝐿𝑖𝑡𝑒𝑟𝑎𝑐𝑦 = 𝛽1 𝑁𝑢𝑚𝑒𝑟𝑎𝑐𝑦 + 𝛽2 𝐹𝑒𝑚𝑎𝑙𝑒 + 𝛽3 𝑆𝑐𝑖𝑒𝑛𝑐𝑒 𝑆𝑡𝑟𝑒𝑎𝑚 + 𝛽4 𝑀𝑒𝑑𝑖𝑢𝑚

+ 𝛽5 𝑃𝑎𝑟𝑒𝑛𝑡 𝐸𝑑𝑢𝑐𝑎𝑡𝑖𝑜𝑛 + 𝛽6 𝐸𝑃𝑙𝑎𝑛𝑠 + 𝛽7 𝐼𝑛𝑐𝑜𝑚𝑒
+ 𝛽8 𝐹𝑖𝑛𝑎𝑛𝑐𝑖𝑎𝑙 𝐸𝑑𝑢𝑐𝑎𝑡𝑖𝑜𝑛 + 𝛽9 𝑃𝑎𝑟𝑒𝑛𝑡 𝐼𝑛𝑣𝑜𝑙𝑣𝑒𝑚𝑒𝑛𝑡 + 𝑢𝑆𝑐ℎ𝑜𝑜𝑙
+ 𝑢𝐺𝑟𝑎𝑑𝑒 + 𝜀

where 𝑢𝑆𝑐ℎ𝑜𝑜𝑙 and 𝑢𝐺𝑟𝑎𝑑𝑒 capture the effects of school and grade, respectively.
This model accounts for the lack of independence within clusters by building
in random effects associated with each cluster. This type of model is typically used
with educational data where students are nested within grades, which are in turn
nested within schools.
The primary independent variable of interest, Numeracy, is a PCS measure
based on only three questions, resulting in four possible values. As a result, we treat
it as a discrete variable. Because very few (22) in our sample answered all the
numeracy questions incorrectly, we opted to go with three levels of numeracy: low
(0 or 1 question correct), medium (2 questions correct), and high (3 questions
correct).
“Parent education” represents a set of indicator variables defined as the highest
level of education attained by the parents (father or mother) as reported in Question
D4. The variable “education plans” similarly uses indicator variables to represent
answers to question D5, with two-year and four-year college attendance combined
in a single category. All other control variables represent indicator variables
reflecting answers to questions D1, D3, D7, D9, and D10.

Results and Discussion

Table 2 shows the PCS and guessing probabilities for the numeracy questions. The
three numeracy questions are labelled “percentage,” “division,” and “interest
calculation” to indicate what type of calculation is being expected by the question.
The mean PCS for numeracy across all students was 81.0% and was significantly
different from the guessing probability (p < 0.01). The PCS for each of the three
questions were also significantly different from the guessing probability (p < 0.01).
The fact that the PCS was statistically different from the guessing probability and
the large difference between the guessing probability and the actual score (33% vs

http://scholarcommons.usf.edu/numeracy/vol11/iss2/art5 10
DOI: https://doi.org/10.5038/1936-4660.11.2.5
 Jayaraman et al.: The Connection between Financial Literacy and Numeracy

Table 2
Percentage Correct Score for Numeracy
Guessing Probability (%) Percentage Correct Score (%)
Numeracy 33.3 81***
N1: Percentage 33.3 81***
N2: Division 33.3 87***
N3: Interest Calculation 33.3 75***
Note: Asterisks at the question level indicate the p-value associated with a two-tailed t test of the hypothesis that the mean
percent correct equals the guessing probability. Asterisks at the aggregate level indicate the p-value associated with a two-
tailed t test of the hypothesis that the aggregate mean percent correct equals the guessing probability. ***p < 0.01

Table 3
Percentage Correct Score for Financial Literacy
Guessing Probability (%) Percentage Correct Score (%)
Overall Financial Literacy 32.9 44***
Compound Interest / Inflation 33.3 45***
(Basic Financial Literacy)
Investing 34.4 44***
(Sophisticated Financial Literacy)
Borrowing 33.3 40***
Insurance 25 50***
Note: Asterisks at the question level indicate the p-value associated with a two-tailed t test of the hypothesis that the mean
percent correct equals the guessing probability. Asterisks at the aggregate level indicate the p-value associated with a two-
tailed t test of the hypothesis that the aggregate mean percent correct equals the guessing probability. ***p < 0.01

81.0%) implies that the majority of the students did not guess the answers to the
numeracy questions. The 74.6% PCS on the interest calculation question (N3) was
the lowest, indicating that it was the most difficult of the three questions and
involved a more sophisticated calculation. This result is consistent with other
literature that finds interest calculations to be the most difficult numeracy question
(Banks and Oldfield 2007; Lusardi and Mitchell 2011). The 81.0% mean PCS is
fairly high, but does not come as a surprise as high school students in India are
expected to have mastery over basic mathematics skills. Our finding of high levels
of numeracy among the students is similar to other findings of fairly high levels of
numeracy among young people in the U.S. (Lusardi et al. 2010).
Table 3 presents the PCS and guessing probabilities for financial literacy and
its subscales. All the PCS scores were significantly different from the guessing
probability (p < 0.01), and the difference between the guessing probability and the
actual score (32.9% vs 44.2%) was fairly large, implying that the majority of the
students did not just guess the answer to the financial literacy questions. The 44.2%
overall financial literacy was lower than that found using the same sophisticated
financial literacy questions in Germany and the United States. In those studies,
Erner et al. (2016) and Lusardi and Mitchell (2017) report mean scores of roughly
48%. The PCS for the subscales were roughly around the overall financial literacy
levels, with knowledge of borrowing being the lowest (40.1%) and knowledge of
insurance being the highest (49.7%).
Table 4 reports mean numeracy and financial literacy scores by demographic
subgroups. There was a significant (p < 0.01) difference in numeracy by self-

Published by Scholar Commons, 2018 11

 Numeracy, Vol. 11 [2018], Iss. 2, Art. 5

Table 4
Numeracy and financial literacy by various groups
Numeracy PCS (%) Financial Literacy PCS (%)
Math Score
Under 30 39% 39%
30 to 50 68% 42%
50 to 75 80% 44%
75 to 90 85% 46%
Above90 82% 43%
F Statistic 14.00*** 1.83

Gender
Male 75% 40%
Female 83% 45%
F statistic 7.11*** 15.02***

Education Stream
Science 73% 38%
Commerce 88% 49%
F statistic 50.27*** 149.10***

Grade
10 73% 39%
11 84% 45%
12 85% 47%
F Statistic 9.60*** 20.50***

Medium of Education
English 76% 40%
Tamil 85% 47%
F statistic 16.90*** 47.45***

Parental Education
No School 72% 44%
Did not complete high school 85% 47%
Completed high school 85% 44%
Some college 76% 42%
College graduate 78% 40%
F statistic 4.70*** 5.283***

Future Educational Plans

No further education 70% 41%
Attend college 83% 45%
Vocation training 60% 39%
F statistic 10.80*** 3.13**

Income
Poor 88% 47%
Middle 75% 40%
Upper Middle 73% 42%
Rich 70% 43%
F Statistic 17.00*** 11.42***
Note: Asterisks level indicate the p-value associated with an F test of the hypothesis that the mean percent correct is the
same for all subgroups if a given demographic variable. *p < 0.10, **p < 0.05, ***p < 0.01

reported math scores. Students who self-reported low math scores did score poorly
on numeracy, but we did not find any significant difference in the financial literacy
scores by self-reported math scores. Though the results were not statistically
significant, those who reported low math scores did have lower financial literacy

http://scholarcommons.usf.edu/numeracy/vol11/iss2/art5 12
DOI: https://doi.org/10.5038/1936-4660.11.2.5
 Jayaraman et al.: The Connection between Financial Literacy and Numeracy

(39%) than the ones who reported high math scores (46%). The statistically
insignificant results may mean that students’ self-assessments of their own math
abilities are not a good indicator of their financial literacy. Further research needs
to be done in order to confirm this hypothesis.
Numeracy and financial literacy do seem to differ by socioeconomic status,
with poor students actually showing much better numeracy skills (88%) than their
wealthier counterparts (70%). One potential explanation for this result could be that
poorer children are more involved in the day-to-day running of the family and in
many cases contribute to the income of the family by doing small jobs. This
experience could potentially enhance their numeracy skills. There is some support
to this argument provided by a study of mathematical abilities of child street
vendors in Brazil (Saxe 1988) and a study of mathematical skills of children
working in informal markets in India (Banerjee et al. 2017). This hypothesis would
be an interesting topic for future research. We also find that students who planned
to attend college had a higher level of numeracy and financial literacy than those
who did not.
We find significant (p < 0.01) gender differences in numeracy with female
students scoring 8 percentage points higher than the male students. A similar gender
difference was also seen in financial literacy levels, with females outperforming
males. White et al. (2016) report gender differences in mathematical achievement
among 8- to 11-year-old children in India with males outperforming females, which
is contrary to our finding, though our study involved a different age group (14 to
18 years old) and measured numeracy as opposed to mathematical achievement.
We also analyze whether there was a similar gender difference among the students
in the one coeducational school in our sample and find no significant gender
difference. The students in the coeducational school were from a middle/upper
middle class background. This fact leads us to hypothesize that the gender
differences that we find may be driven by socioeconomic status.
We also find a fairly large and significant difference in numeracy between
students in the science vs. commerce streams, with the latter exhibiting a 15
percentage-point higher level. Anecdotal evidence suggests that in India, students
who are good at math tend to go the science route. If we make the reasonable
assumption that students who have good math skills will also have good numeracy
skills, this finding surprises us. We suspect that this finding may be intertwined
with the finding of gender differences and socioeconomic differences because the
majority of commerce students in our sample were girls from a lower
socioeconomic background. So, we again look at the coeducational school, which
is more homogeneous, and see a similar difference in numeracy across the two
curricular streams. We also see a difference in numeracy across socioeconomic
status, but not across gender. This leads us to suggest that gender may not have as
big a mediating effect on curricular-stream differences as socioeconomic status.

Published by Scholar Commons, 2018 13

 Numeracy, Vol. 11 [2018], Iss. 2, Art. 5

Table 5
Relationship between Numeracy and Financial Literacy Conditional on Control Variables
Linear Mixed Model Ordered Logistic Regression
Financial Literacy Financial Literacy
Independent Variable b (SE) b (SE)
Numeracy (Low) -0.048*** (0.028) -1.05*** (0.45)
Numeracy (Medium) -0.004 (0.026) -0.46 (0.43)
Numeracy (High) 0.056** (0.025) 0.12* (0.42)
Female 0.005 (0.015) 0.135 (0.259)
Science Stream -0.093*** (0.013) -1.627*** (0.189)
Tamil Medium 0.019 (0.026) 0.408 (0.302)
Parent Education (Graduate) -0.007 (0.015) -0.175 (0.247)
Parent Education (Did Not Comp High School) -0.002 (0.013) 0.029 (0.201)
Parent Education (No School) -0.010 (0.017) -0.101 (0.264)
Parent Education (Some College) 0.015 (0.018) 0.114 (0.279)
Income (Poor) 0.011 (0.015) 0.027 (0.231)
Income (Rich) 0.020 (0.018) 0.098 (0.319)
Income (Upper Middle) 0.018 (0.016) 0.116 (0.256)
Financial Education (None) 0.016 (0.023) 0.312 (0.346)
Financial Education (Some) 0.024** (0.012) 0.588** (0.191)
Financial Education (Very Little) 0.037** (0.017) 0.865** (0.273)
Parent Involvement (Borrowing) -0.049 (0.031) -0.746 (0.5)
Parent Involvement (Did Not Discuss) 0.002 (0.017) -0.129 (0.264)
Parent Involvement (Investing) -0.010 (0.024) -0.326 (0.374)
Parent Involvement (Saving) -0.002 (0.011) -0.162 (0.168)
Education Plans (No Further Education) -0.032 (0.026) -0.634 (0.388)
Education Plans (Vocational Train) -0.006 (0.022) 0.019 (0.352)
Note: Coefficients (b) and standard errors (SE) are from a three-level linear mixed model with school and grade as random
intercepts and an ordered logistic regression model. *p < 0.10, **p < 0.05, ***p < 0.01

A similar education-stream difference is exhibited in financial literacy as well, but

this can be explained by commerce students getting financial education by virtue
of their economics curriculum.
Another surprising finding was the significant difference in numeracy by
medium of education, with students taught in Tamil showing 9 percentage point
higher levels. A similar difference is present in financial literacy. We believe that
this result again reflects gender and socioeconomic differences, because a majority
of the students taught in Tamil were girls from a lower socioeconomic status.
The discussion above repeatedly demonstrates the limitations of a bivariate
analysis of the relationship between numeracy and financial literacy; with multiple
potentially correlated factors explaining both numeracy and financial literacy, we
need a multivariate approach to disentangle the various contributions. The first two
columns of Table 5 present the results of fitting a three-level linear mixed model
with random intercepts for school and grade. Even after controlling for other
covariates, the results show a strong (p < 0.01) relationship between low numeracy
and financial literacy skills. Low numeracy was associated with a 5.2 percentage-
point reduction in financial literacy (relative to medium numeracy), even after
controlling for a whole host of factors as described in the analysis section. High
numeracy was associated with a 5.1 percentage-point increase. Thus, these findings

http://scholarcommons.usf.edu/numeracy/vol11/iss2/art5 14
DOI: https://doi.org/10.5038/1936-4660.11.2.5
 Jayaraman et al.: The Connection between Financial Literacy and Numeracy

indicate that there is a fairly strong relationship between numeracy and financial
literacy. Similar findings, though not directly comparable, are reported by Erner et
al. (2016) with German high school students, where one math grade unit is
associated with a 4% increase in financial literacy. The Erner et al. (2016) study
did not attempt to measure numeracy as our study did, but instead used the math
grade on the school report card (1 to 6 rating) as a proxy, but their study did measure
financial literacy using the same basic and sophisticated financial literacy questions
as our survey.
Though there are numerous precedents in the literature for treating the
independent variable, financial literacy, as a continuous variable, we were curious
if the results would differ substantially if we treated the independent variable as a
discrete variable. Thus, we also fitted an ordered logistic regression model to the
data with the independent discrete variable being financial literacy and the primary
dependent variable being numeracy.
The third and fourth columns in Table 5 present the results of the ordered
logistic regression model. The results are consistent with the linear mixed model,
and show that low numeracy was significantly (p < 0.01) associated with decreased
financial literacy and high numeracy was significantly (p < 0.10) associated with
increased financial literacy. Thus, the results hold true whether financial literacy is
treated as a continuous variable or a discrete variable.

Conclusion
This study is one of the first to explore the relationship between numeracy and
financial literacy among high school students in a developing country. We find a
strong statistically significant (p < 0.01) relationship between numeracy and
financial literacy. This relationship is robust and held even when controlling for
factors including gender, grade, education stream, language of instruction, parental
involvement, future education plans, parental education, family income, and level
of financial education.
A limitation of our study is that our sample consists of students from only three
high schools in India. So, caution should be exercised in generalizing the results.
Despite this limitation, the strong relationship between numeracy and financial
literacy in our study suggests that educational policy makers should consider
increasing numeracy skills and in particular promote numeracy as it relates to
financial literacy (interest calculations, chart/data comparisons and interpretations,
etc.) as part of the curriculum. An increase in numeracy skills was associated with
a fairly large increase in financial literacy in our study, which suggests that
increasing numeracy skills may effectively aid in increasing financial literacy. We
caution that increasing numeracy should not be considered a substitute for

Published by Scholar Commons, 2018 15

 Numeracy, Vol. 11 [2018], Iss. 2, Art. 5

increasing financial literacy, rather, our results simply suggest that increasing
numeracy may help in increasing financial literacy.
Our findings suggest the need for numeracy and financial literacy to be taught
and learned in an integrated manner. These two areas naturally lend themselves to
being integrated in teaching and learning. Because numeracy is mathematical
content embedded in real world contexts, teachers should incorporate real world
financial literacy contexts, such as interest rate calculations, into their mathematics
curriculum. Such an integrated curriculum may help improve financial literacy and
help our younger generation be wise decision-makers and consumers in the global
arena.
In terms of directions for future research, studies need to be done to replicate
our findings in other developing and developed countries. Research on effectively
integrating financial literacy across the curriculum is in its infancy and needs
further studying. A study of numeracy and financial literacy of street children
would be fascinating. Further studies need to be performed to understand the
mediating effects of variables such as socioeconomic status and gender on financial
literacy and numeracy, so that appropriate interventions can be designed.

Acknowledgements
The authors would like to thank the principals of Sri RKM Sarada Vidyalaya Model
Higher Secondary School, Sri Ramakrishna Math Vivekananda Centenary Girls
Higher Secondary School, and Jain Vidyalaya for their cooperation in conducting
this study.

References
Banks, James and Zoë Oldfield. 2007. “Understanding Pensions: Cognitive
Function, Numerical Ability and Retirement Saving.” Fiscal Studies 28(2):
143⎼170.
Banerjee, Abhijit V., Swati Bhattacharjee, Raghabendra Chattopadhyay, and J.
Ganimian Alejandro. 2017. “The Untapped Math Skills of Working
Children in India: Evidence, Possible Explanations, and Implications.”
Beteille, Tara. 2009. “Absenteeism, Transfers, and Patronage: The Political
Economy of Teacher Labor Markets in India.” PhD diss., Stanford
University.
Borodich, Sergey, Svetlana Deplazes, Nadzeya Kardash, and Alexander Kovzik.
2010. “Comparative Analysis of the Levels of Financial Literacy among
Students in the US, Belarus, and Japan.” Journal of Economics and
Economic Education Research 11(3): 71.

http://scholarcommons.usf.edu/numeracy/vol11/iss2/art5 16
DOI: https://doi.org/10.5038/1936-4660.11.2.5
 Jayaraman et al.: The Connection between Financial Literacy and Numeracy

Butters, Roger B. and Carlos J. Asarta. 2011. “A Survey of Economic

Understanding in US High Schools.” The Journal of Economic Education
42(2): 200⎼205.
Butters, Roger B., Carlos J. Asarta, and S. McCoy. 2012. “Financial Literacy and
Gender in US High Schools.” Journal of Economics and Finance Education
11(2): 142⎼149.
Cameron, Michael P., Richard Calderwood, Ashleigh Cox, Steven Lim, and
Michio Yamaoka. 2013. “Personal Financial Literacy among High School
Students in New Zealand, Japan and the USA.” Citizenship, Social and
Economics Education 12(3): 200⎼215.
Chen, Haiyang and Ronald P. Volpe. 1998. “An Analysis of Personal Financial
Literacy among College Students.” Financial Services Review 7(2):
107⎼128.
Christelis, Dimitris, Tullio Jappelli, and Mario Padula. 2010. “Cognitive Abilities
and Portfolio Choice.” European Economic Review 54(1): 18⎼38.
Cole, Shawn, Thomas Sampson, and Bilal Zia. 2011. “Prices or Knowledge?
What Drives Demand for Financial Services in Emerging Markets?” The
Journal of Finance 66(6): 1933⎼1967.
Danes, Sharon M. and Heather R. Haberman. 2007. “Teen Financial Knowledge,
Self-Efficacy, and Behavior: A Gendered View.” Journal of Financial
Counseling & Planning 18(2): 48⎼60.
de Bassa Scheresberg, Carlo. 2013. “Financial Literacy and Financial Behavior
among Young Adults: Evidence and Implications.” Numeracy 6(2): Article
5.
Erner, Carsten, Michael Goedde-Menke, and Michael Oberste. 2016. “Financial
Literacy of High School Students: Evidence from Germany.” The Journal of
Economic Education 47(2): 95⎼105.
Gerardi, Kristopher, Lorenz Goette, and Stephan Meier. 2010. “Financial Literacy
and Subprime Mortgage Delinquency: Evidence from a Survey Matched to
Administrative Data.” Federal Reserve Bank of Atlanta, Working Paper
Series, April.
Hanna, Michael E., Robert R. Hill, and Grady Perdue. 2010. “School of Study and
Financial Literacy.” Journal of Economics and Economic Education
Research 11(3): 29⎼37.
Hung, Angela, Andrew Parker, and Joanne Yoong. 2009. “Defining and
Measuring Financial Literacy.” RAND Corporation Publications
Department WR-78, September.
Huston, Sandra J. 2010. “Measuring Financial Literacy.” Journal of Consumer
Affairs 44(2): 296⎼316.

Published by Scholar Commons, 2018 17

 Numeracy, Vol. 11 [2018], Iss. 2, Art. 5

Krosnick, Jon A. 1991. “Response Strategies for Coping with the Cognitive
Demands of Attitude Measures in Surveys.” Applied Cognitive Psychology
5(3): 213⎼236.
Krosnick, Jon A., Allyson L. Holbrook, Matthew K. Berent, Richard T. Carson,
W. Michael Hanemann, Raymond J. Kopp, Robert Cameron Mitchell,
Stanley Presser, Paul A. Ruud, V. Kerry Smith, Wendy R. Moody, Melanie
C. Green, and Michael Conaway. 2002. “The Impact of ‘No Opinion’
Response Options on Data Quality: Non-Attitude Reduction or an Invitation
to Satisfice.” Public Opinion Quarterly 66(3): 371⎼403.
Lusardi, Annamaria, Pierre-Carl Michaud, and Olivia S. Mitchell. 2017. “Optimal
Financial Knowledge and Wealth Inequality.” Journal of Political Economy
125(2): 431⎼477.
Lusardi, Annamaria, and Olivia S. Mitchell. 2007a. “Baby Boomer Retirement
Security: The Roles of Planning, Financial Literacy, and Housing Wealth.”
Journal of Monetary Economics 54(1): 205⎼224.
Lusardi, Annamaria, and Olivia S. Mitchell. 2007b. “Financial Literacy and
Retirement Preparedness: Evidence and Implications for Financial
Education.” Business Economics 42(1): 35⎼44.
Lusardi, Annamaria, and Olivia S. Mitchell. 2011. Financial literacy and
planning: Implications for retirement wellbeing. No. w17078. National
Bureau of Economic Research.
Lusardi, Annamaria, and Olivia S. Mitchell. 2017. “How Ordinary Consumers
Make Complex Economic Decisions: Financial Literacy and Retirement
Readiness.” Quarterly Journal of Finance 7(3): 1750008.
https://doi.org/10.1142/S2010139217500082.
Lusardi, Annamaria, Olivia S. Mitchell, and Vilsa Curto. 2010. “Financial
Literacy among the Young.” Journal of Consumer Affairs 44(2): 358⎼380.
Mandell, Lewis. 2008. The Financial Literacy of Young American Adults: Results
of the 2008 National Jump$tart Coalition Survey of High School Seniors
and College Students. Washington, DC: The Jump$tart Coalition for
Personal Financial Literacy.
National Council of Educational Research and Training. 2005. “A Study of
Mathematics Curriculum for School Education since Last Two Decades and
its Implementation.” National Council of Educational Research and
Training.
OECD. 2017. PISA 2015 Results (Volume IV): Students' Financial Literacy. Paris,
France: OECD Publishing.
President’s Advisory Committee on Financial Literacy. 2008. “Annual Report to
the President: Executive Summary.”
Saxe, Geoffrey B. 1988. “Candy Selling and Math Learning.” Educational
Researcher 17(6): 14⎼21.

http://scholarcommons.usf.edu/numeracy/vol11/iss2/art5 18
DOI: https://doi.org/10.5038/1936-4660.11.2.5
 Jayaraman et al.: The Connection between Financial Literacy and Numeracy

Shavelson, Richard J. 2008. “Reflections on Quantitative Reasoning: An

Assessment Perspective.” In Calculation vs. Context: Quantitative Literacy
and Its Implications for Teacher Education, edited by Bernie L. Madison
and Lynn Arthur Steen, 27⎼47. Washington, DC: Mathematical Association
of America.
Stango, Victor, and Jonathan Zinman. 2009. “What Do Consumers Really Pay on
Their Checking and Credit Card Accounts? Explicit, Implicit, and
Avoidable Costs.” The American Economic Review 99(2): 424⎼429.
https://doi.org/10.1257/aer.99.2.424.
Van Rooij, Maarten, Annamaria Lusardi, and Rob Alessie. 2011. “Financial
Literacy and Stock Market Participation.” Journal of Financial Economics
101(2): 449⎼472.
Varcoe, Karen P., Allen Martin, Zana Devitto, and Charles Go. 2005. “Using a
Financial Education Curriculum for Teens.” Journal of Financial
Counseling and Planning 16(1): 63⎼71.
Walstad, William B., Ken Rebeck, and Richard A. MacDonald. 2010. “The
Effects of Financial Education on the Financial Knowledge of High School
Students.” Journal of Consumer Affairs 44(2): 336⎼357.
White, Gregory, Matt Ruther, Joan R. Kahn, and Dian Dong. 2016. “Gender
Inequality amid Educational Expansion in India: An Analysis of Gender
Differences in the Attainment of Reading and Mathematics Skills.” Journal
of Research in Gender Studies 6(2): 153⎼182.

Published by Scholar Commons, 2018 19