Homeownership and financial literacy: evidence from China in the perspective of ‘learning by doing’

Siliang Wang and Yang Liu

Housing Studies, 2024, vol. 39, issue 11, 2827-2851

Abstract: Financial literacy is becoming an increasingly important policy consideration, yet its determinants are still underexplored. From the theoretical perspective of ‘learning by doing’, the effect of homeownership on financial literacy in urban China is identified by the instrumental variable strategy. First, the borrowing experience to purchase a home can awaken homeowners to develop basic financial knowledge, but the resulting debt burden constrains homeowners from participating in the financial market, crowding out their access to advanced financial skills. Second, the growth in home equity wealth induces homeowners pledge high-value properties as collateral and invest in more homes, in which case the collateralizing experience facilities the advancement of basic finance literacy, while locking the asset portfolio in the housing sector hinders homeowners from learning advanced financial skills. Moreover, the specific kind of financial literacy that homeowners show an advantage in differs depending on their income. These findings cast a new light on understanding the return of housing property to family financial affairs.

Date: 2024
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/02673037.2023.2228238 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:chosxx:v:39:y:2024:i:11:p:2827-2851

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/chos20

DOI: 10.1080/02673037.2023.2228238

Access Statistics for this article

Housing Studies is currently edited by Chris Leishman, Moira Munro, Ray Forrest, Alex Schwartz, Hal Pawson and John Flint

More articles in Housing Studies from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().