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Financial exclusion in developed countries: a field experiment among migrants and low-income people in Italy

Giorgia Barboni (), Alessandra Cassar () and Timothée Demont ()
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Giorgia Barboni: Princeton University

Journal of Behavioral Economics for Policy, 2017, vol. 1, issue 2, 39-49

Abstract: We designed an experiment to estimate the socio-economic and behavioral characteristics associated with financial exclusion in a developed economy and the demand for savings products progressively trading-off flexibility for commitment. Our sample includes people in Italy living below the poverty line, stratified by migration status. Despite a large bank branch penetration in the study area, we find a high rate of financial exclusion, with households below the sample median income being unbanked at twice the rate of those above (30% vs. 15%), a difference that is especially significant for migrants. Financial exclusion is associated with poverty and social exclusion, as measured by unemployment, low food consumption, and little help from personal networks. Despite a high-declared willingness to open new accounts and a strong interest in commitment products following a financial education training seminar, actual uptake in the year to follow remains low, suggesting that demanddriven factors besides knowledge hamper access to formal financial services, namely incomes that are perceived too low to make accounts worthwhile. Yet, migrants, especially if non-Muslim, appear more willing to become financially included than non-migrants, suggesting that there are gains to be made by targeting minorities.

Keywords: financial exclusion; savings; migrants; field experiment (search for similar items in EconPapers)
JEL-codes: D14 C93 G21 (search for similar items in EconPapers)
Date: 2017
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Working Paper: Financial exclusion in developed countries: a field experiment among migrants and low-income people in Italy (2017)
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