Quotation Fuhrmann, Bettina. 2014. Measuring Financial Literacy - Analysis of Item Content and Format. Section Financial Education of the German Society of Economic Education, Essen, Deutschland, 04.12.-05.12.




This contribution analyses items that have been used for the PISA 2012-financial literacy module in order to measure financial knowledge and the ability to solve financial problems. The analysis focuses on the content covered by these items as well as on methodological aspects and can only take those items into account that have been published by the OECD. The analysis shows that the tasks that are reflected in the items are oriented towards present and future financial challenges that students might face. Most of them require the application of financial knowledge and problem solving skills. Most interestingly, the items do not ask the respondents to make decisions although decision making is at the heart of the OECD's definitions of financial literacy. Taking a closer look at the item format it can be seen that most items are multiple choice-items with only a small number of distractors. Therefore giving the correct answer can either be based on actual knowledge and skills or it can be attributable to successful guessing. This may be one possible reason why in some studies the respondents were not able to consistently solve the problems when asked to do so repeatedly. Since not all items ask respondents to explain their reasoning, it is not clear whether or not the respondents have really understood the underlying financial concept. Furthermore it could be discussed whether or not these items allow a valid measurement of financial literacy. Some questions mainly require students to read carefully and make some calculations that are not necessarily related to understanding financial terms and concepts. Accordingly, PISA results have shown that financial literacy scores are highly correlated to mathematics and reading abilities. Though reading and calculating may be important prerequisites for being financially literate, they do not necessarily suffice to solve financial problems which is not reflected in these items.


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Publication's profile

Status of publication Published
Affiliation WU
Type of publication Paper presented at an academic conference or symposium
Language English
Title Measuring Financial Literacy - Analysis of Item Content and Format
Event Section Financial Education of the German Society of Economic Education
Year 2014
Date 04.12.-05.12.
Country Germany
Location Essen


Fuhrmann, Bettina (Details)
Institute for Business Education IN (Details)
Competence Center for Empirical Research Methods WE (Details)
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