Description of the programme

This programme involved a 20-minute computer-based course involving slides, numerical examples and a voice-over, delivered to groups of Italian students.

The programme aimed to improve student’s understanding of basic financial concepts. The research measured the effects of the course on students’ financial literacy, investment attitudes and self-assessed perceptions of financial literacy.

• It covered three topics:
• interest compounding;
  • inflation; and
  • risk diversification.

The programme was developed by the Italian Ministries of University and Research and

• was administered in two ways:
• in a lab (an artificial classroom environment) where participants took the course on individuals computers, listening to the audio content through headphones; and
  • in ‘the field’ where subjects received an e-mail directing them to the course and completed it in their own time on their home or university computers.

The study

• An independent impact evaluation of the programme was conducted by the Department of Economics at the Foscari University of Venice. This study involved pre- and post-programme measurement using a randomised control trial (RCT) approach with a comparison group of students who did not participate in the programme but instead watched a video about an unrelated subject.
• The experiment was conducted in both ‘field’ and laboratory conditions and the post measurement was conducted directly after the intervention. Therefore, the evaluation does not provide any indication of whether the improvements in financial capability were sustained for any meaningful length of time.

Key findings

The evaluation found positive impacts in relation to the following outcomes:

Financial capability (mindset):

• A small but still significant improvement was found in participating students' views on investment and financial risk. The probability of answering a question about investment planning in the desired way increased by 11% for the participating students, versus a decrease of 6% amongst the comparison group.

Financial capability (ability):

• The results show a positive effect of financial education on financial literacy. Students in the treatment group were more aware of basic financial concepts.
• Overall, the number of correct answers to questions designed to measure students’ financial knowledge and understanding increased by 8% amongst students participating in the course but decreased amongst the comparison group.
• The largest increase was seen in the likelihood of getting a question about compounding interest correct – 31% for the participating students (in the field sub-group), versus a slight decrease for the comparison group.
• After controlling for variations in financial literacy and investment attitudes between the two groups of students the intervention was found to have had a significant and positive effect on students’ financial knowledge immediately afterwards.
• There was a greater improvement in self-assessed financial literacy than in actual knowledge. Three in ten students (30%) assessed their financial literacy as being higher following the intervention when in fact their post-interventions test scores were the same or lower than their pre-intervention scores.

Points to consider

The study purports to find evidence for a pattern showing how financial education seems to improve what individuals think they know rather than what they actually know.

Furthermore, the findings suggest that financial education programmes risk causing individuals to become more confident in their abilities without necessarily equipping them when facing financial decisions.

Full report

Full research report