Financial literacy of Portuguese undergraduate students in polytechnics: does the area of the course influence financial literacy?

Paula Sarabando, Roge rio Matias, Pedro Vasconcelos and Tiago Miguel
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Paula Sarabando: School of Technology and Management, Polytechnic Institute of Viseu, Viseu, Portugal
Roge rio Matias: School of Technology and Management, Polytechnic Institute of Viseu, Viseu, Portugal
Pedro Vasconcelos: PricewaterhouseCoopers, Portugal
Tiago Miguel: School of Technology and Management, Polytechnic Institute of Viseu, Viseu, Portugal

Journal of Economic Analysis, 2023, vol. 2, issue 2, 96-113

Abstract: Financial literacy seems to be more important and focused than ever. Several recent studies have found that Portugal is at bottom of the table compared to the Eurozone countries regarding financial literacy. As it’s a key factor in the development of a country, it appears to be crucial to understand what people know about financial matters when they complete compulsory schooling. With a sample of 296 Portuguese students who enrolled in the polytechnic higher education system for the first time, we studied if they understand simple concepts related to financial issues (such as loans), as well as whether they are aware of the risk of not recovering the money invested that is embedded in some of the most talked-about and common financial products that are available in the market. This last objective seems to be relevant since a lot of fraudulent schemes involving teenagers, young adults, and financial markets have emerged in recent years. From the results, some disturbing conclusions can be drawn. For instance, more than two-thirds of the sample do not know what Euribor is (similar result regarding Spread). About a third of the simple do not understand inflation’s consequences. 16,9% do not know what term deposits are, and derivative products and saving certificates are seen as very alike regarding the risk they represent. Students who chose a business-related course as their first choice when applying showed a higher level of financial literacy, although it is still low compared to what one would expect.

Keywords: Financial literacy; Portugal; Risk perception; Personal finance (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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