Financial Literacy And Mental Accounting Analysis Of Financial Decisions And Shopping Interests In The Covid-19 Pandemic Era

Dita Rari Dita Rari Dwi and Teguh Iman Basuki

MPRA Paper from University Library of Munich, Germany

Abstract: The Covid 19 pandemic is a situation that illustrates the uncertainty of economic conditions nationally and globally and has an impact on how individuals should react to it in financial terms. Therefore, this study aims to examine the effect of financial literacy and mental accounting on financial decisions and spending interests in the COVID-19 pandemic situation based on prospect theory and behavioural life-cycle theory. The results of research on lecturers and staff respondents at STIE Equity Bandung - Indonesia, the SEM-PLS analysis results show that financial literacy and mental accounting have an effect on financial decisions, and only mental accounting has an effect on shopping interest. In terms of prospect theory, the research findings found that in pandemic situations, individuals generally behave in risk-aversion behaviour. Meanwhile, in the viewpoint of the behavioural life-cycle theory, individuals view money as current assets with precautionary reasons.

Keywords: Financial literacy; financial decisions; mental accounting; shopping interest; Financial literacy; financial decisions; mental accounting; shopping interest (search for similar items in EconPapers)
JEL-codes: G0 G02 (search for similar items in EconPapers)
Date: 2022-05-24
New Economics Papers: this item is included in nep-fle, nep-sea and nep-upt
References: View references in EconPapers View complete reference list from CitEc
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Published in Journal of Business and Finance in Emerging Markets Regular Issue.5(2022): pp. 1-12

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