Low numeracy is associated with poor financial well-being around the world

Wändi Bruine de Bruin and Paul Slovic

PLOS ONE, 2021, vol. 16, issue 11, 1-15

Abstract: Numeracy refers to the ability to use numbers, including converting percentages (e.g., 10%) into absolute frequencies (e.g., 1 in 10). Studies have suggested that numeracy is correlated to financial outcomes, suggesting its relevance to financial decisions. However, almost all research on numeracy has been conducted in high-income countries in Europe and North America. Our analyses suggest that low numeracy is much more common in low-income countries, thus potentially threatening the financial well-being of the world’s poorest. We analyzed data from the Lloyd’s Register Foundation World Risk Poll, which assessed basic numeracy in 141 countries, including 21 low-income, 34 lower middle income, 43 upper middle income, and 43 high-income countries. Numeracy was associated with being among the poorest 20% of one’s country, and with difficulty living on one’s income, even after accounting for income, education, and demographics. These findings underscore the importance of worldwide numeracy education.

Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:plo:pone00:0260378

DOI: 10.1371/journal.pone.0260378

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