Explore the vast range of titles available.

The recent financial crisis is challenging the reform approach to mandated pension a scheme that has emerged over recent decades across the world. This reform approach is characterized by a move toward multi-pillar pension systems and includes the creation or extension of a mandatory funded pillar with defined contribution design. The rationale and viability of such a pillar is contingent on an enabling environment and the delivery of high risk-adjusted net rates of return that beat the natural benchmark, which is the internal rate of return that an unfunded mandated scheme is able to achieve. Two key aspects of mandated and funded defined contribution schemes have been under discussion and investigation since dedicated pension funds were created: (a) the high fees levied by privately organized pension funds and the consequence for the net rate of return; and (b) the investment products of these funds and their capability to address the investment risks and to deliver the expected retirement income in a life-cycle context. To this end, country policies have experimented with a variety of approaches to improve outcomes with some important leads but overall modest results. This book proposes to take a fresh and highly innovative look at both policy issues. It suggests stepping back and looking at the underlying causes of the issues at stake instead of merely trying to address their symptoms. In addressing the high fees of pension funds, it focuses on the less-than-ideal conditions inert consumers facing firms with market powers and proposes to apply solutions derived from industrial organization models and pricing methods that better reflect the cost structure of the supply of pension services. In addressing the investment risks, it asks how to improve fund managers' risk-adjusted investment performance when participants are inert.

PurposeWomen's financial inclusion has become a global research agenda, and past studies provide mixed evidence on the determinants of financial inclusion among women entrepreneurs across the globe. However, the impact of digital financial literacy on women's financial inclusion has seldom been addressed in the past literature.Design/methodology/approachThe authors perform a cross-sectional analysis of 144 countries using the World Bank Global Findex Database.FindingsThis study’s probabilistic regression results indicate that women entrepreneurs with a higher degree of digital financial literacy are more likely to engage in formal banking channels.Practical implicationsThe study findings have practical implications in terms of allowing regulators and banks to draw effective policies to attract women customers. Lack of effective regulatory intervention could lead to women exploring financial crimes, such as money laundering, due to their lack of involvement with the formal banking channel.Originality/valueThe authors explore the impact of digital financial literacy on women's financial inclusion. Such evidence is rare in the existing literature.Peer reviewThe peer review history for this article is available at: https://publons.com/publon/10.1108/IJSE-04-2022-0277

This article uses data from the 2020 TIAA Institute-GFLEC Personal Finance (P-Fin) Index to show that many American families were financially fragile well before the COVID-19 pandemic hit the U.S. economy. Financial fragility is particularly severe among specific demographic groups, such as African-Americans and those with low income. The article also shows that financial fragility is strongly linked to financial literacy and that many Americans are ill-equipped to deal with the financial decisions needed to navigate through a financial crisis. Suggestions are provided to deal with personal finance decisions in times of emergency.

Policy makers have embraced financial education as a necessary antidote to the increasing complexity of consumers' financial decisions over the last generation. We conduct a meta-analysis of the relationship of financial literacy and of financial education to financial behaviors in 168 papers covering 201 prior studies. We find that interventions to improve financial literacy explain only 0.1% of the variance in financial behaviors studied, with weaker effects in low-income samples. Like other education, financial education decays over time; even large interventions with many hours of instruction have negligible effects on behavior 20 months or more from the time of intervention. Correlational studies that measure financial literacy find stronger associations with financial behaviors. We conduct three empirical studies, and we find that the partial effects of financial literacy diminish dramatically when one controls for psychological traits that have been omitted in prior research or when one uses an instrument for financial literacy to control for omitted variables. Financial education as studied to date has serious limitations that have been masked by the apparently larger effects in correlational studies. We envisage a reduced role for financial education that is not elaborated or acted upon soon afterward. We suggest a real but narrower role for \"just-in-time\" financial education tied to specific behaviors it intends to help. We conclude with a discussion of the characteristics of behaviors that might affect the policy maker's mix of financial education, choice architecture, and regulation as tools to help consumer financial behavior. This paper was accepted by Uri Gneezy, behavioral economics.

This study provides theory and evidence on the relation between financial literacy overconfidence (FLO) and high-cost borrowing and its mediation and moderation through mobile financial services (MFS). We investigate whether MFS carry the effect of FLO on the household demand for alternative financial services (AFS), such as payday loans. Using the 2018 National Financial Capability Study, we show that using MFS both mediates and moderates the effect of FLO on the use of AFS. We find that unbanked households, who make up around 5% of the sample, are twice as likely to take out payday loans and three times as likely to use AFS than households with access to the banking system. Estimates show that 4% of the total effect of FLO on using AFS and taking out payday loans is mediated by using MFS. We find that households who use MFS are two to three times more likely to access AFS and take out payday loans than those who do not use MFS.

This research uses data from the 2018 National Financial Capability Study to investigate the attributes of households that engage in higher levels of family financial planning. Greater levels of financial planning are evidenced when households report more positive responses in planning for retirement, saving for emergencies, and establishing a will. Based on an ordinal logistic regression, various demographic attributes, objective and subjective financial knowledge scores, frequency of participation in financial education, and the frequent use of financial websites or apps to help with financial tasks are positively related to higher levels of family financial planning. The results have implications for financial literacy education and the development and marketing of websites and apps for personal finance.

Financial planning for retirement is essential to ensure that people have enough money to live the lifestyle they desire when they retire. Self-employed business owners in developed countries widely do financial retirement planning. However, in Malaysia, the percentage of self-employed individuals concerned about financial retirement planning is lower than in other countries. This study aims to identify the relationship between the financial attitude, financial literacy and health literacy of self-employed individuals toward sustainable financial retirement planning in Malaysia and find out the moderating effect of the role of financial advisors. The study utilized structural equation modelling. Data were collected through a survey questionnaire and analyzed using SMART PLS 3.3. The total sample size was 416 self-employed individuals from the northern Malaysian region. The findings revealed that financial attitude and financial literacy significantly impact retirement planning. Moreover, the role of financial advisors moderates the relationship between financial attitude–financial retirement planning and financial literacy–financial retirement planning. The result of the study will fulfil the needs of self-employed individuals to plan their retirement by including the financial planning determinants needed for a well-planned retirement.

Micro-entrepreneurs often lack the financial literacy required to make important financial decisions. We conducted a randomized evaluation with a bank in the Dominican Republic to compare the impact of two distinct programs: standard accounting training versus a simplified, rule-of-thumb training that taught basic financial heuristics. The rule-of-thumb training significantly improved firms' financial practices, objective reporting quality, and revenues. For micro-entrepreneurs with lower skills or poor initial financial practices, the impact of the rule-of-thumb training was significantly larger than that of the standard accounting training, suggesting that simplifying training programs might improve their effectiveness for less sophisticated individuals.

All entrepreneurs must overcome the liabilities of newness and smallness as they attempt to launch and grow a new venture. However, those in poverty face an even greater challenge due to a concept we introduce, known as the liability of poorness, which centers on literacy gaps, a scarcity mindset, intense non-business pressures, and the lack of a safety net. Each of these components of the liability of poorness contributes to the disadvantage and fragility of the enterprises confronting the poor. Implications of this fragility for venture dynamics as well as how some poverty entrepreneurs overcome this liability are explored. Research priorities are discussed for ongoing work on the liability of poorness.

A large number of Americans do not have bank accounts (the ‘unbanked’) or rely on costly alternative financial services (AFS) such as payday loans (the ‘underbanked’), with implications for wealth accumulation and retirement preparedness. Using primary data, we document large racial/ethnic differences in unbanked and in frequent AFS usage rates. We study the role of socio-economic status (SES), financial literacy, trust in financial institutions, networks, and time preferences in explaining these gaps. While these variables explain a large fraction of the white-minority gaps in unbanked status the same is not true for gaps in AFS use. A Blinder-Oaxaca decomposition confirms these patterns: gaps in unbanked status are mostly explained by differences in endowments across groups, for AFS gaps differences in returns to endowments have the largest explanatory power. Our findings suggest that, while related, unbanked and underbanked are distinct concepts with different underlying causes that may require different policy responses.