A Comparative Study on the Impact of Financial Literacy and Overconfidence on Risk Attitudes

Authors

  • Ruizhe Ma Author
  • Yuhan Wang Author

DOI:

https://doi.org/10.20849/abr.v7i3.1122

Keywords:

financial literacy, overconfidence, risk attitude

Abstract

Based on the data of the NFCS in the United States in 2012 and 2015, we measured the level of personal financial literacy and financial literacy overconfidence. By using the Ordered Probit model empirical research, we found that financial literacy and risk appetite were significantly positively correlated, but the positive correlation between financial literacy overconfidence and risk appetite were even tighter. The results of the study showed that people with higher financial literacy levels had greater willingness to take risks, but if there were overconfidence in financial literacy, their risk appetite will be greater.

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Published

2022-04-28

Issue

Vol 7, No 3 (2022)

Section

Articles

License

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

© Asian Business Research. The copyright for all articles published in this journal is retained by the authors. All articles are published under the terms of the Creative Commons Attribution 4.0 International License (CC BY 4.0). This license permits use, distribution, and reproduction in any medium, whether commercial or non-commercial, provided the original work is properly cited.

How to Cite

A Comparative Study on the Impact of Financial Literacy and Overconfidence on Risk Attitudes. (2022). Asian Business Research, 7(3), p30. https://doi.org/10.20849/abr.v7i3.1122