Wharton Pension Research Council Working Papers

Document Type

Working Paper

Date of this Version



Using data from the 2012 Programme for International Students Assessment (PISA) for Italy, this paper investigates whether financial literacy skills play a role in shaping the value that high school students place on schooling. We hypothesize that higher financial literacy may foster students’ awareness of the financial and non-financial benefits of gaining additional education, together with the costs associated with poor school outcomes. We complement OLS estimates with an instrumental variable (IV) approach to recover a plausibly causal effect of financial literacy on the school outcomes of interest, namely (a) truancy and time spent on homework outside of school (time commitment to education), and (b) attitudes towards school (attitudes). Results suggest that higher financial literacy increases students’ perceived value of schooling by boosting their time commitment to education. Conversely, there is no evidence that financial literacy shapes students’ attitudes towards school. We see this finding as consist is easier to measure objectively and reliably than attitudes.


Financial literacy, schooling, truancy, attitudes, youth, Italy

JEL Code

A21, D10, I22, I23

Working Paper Number


Copyright/Permission Statement

All findings, interpretations, and conclusions of this paper represent the views of the authors and not those of the Wharton School or the Pension Research Council. © 2017 Pension Research Council of the Wharton School of the University of Pennsylvania. All rights reserved.


The author gratefully acknowledges the financial support provided by the Fulbright Commission and the School of Arts and Sciences at the University of Pennsylvania. The author thanks Professor Olivia S. Mitchell for helpful guidance on the development of the paper, and Chiara Monticone and Angela Romagnoli for assistance with the data The author is grateful for support provided by the Pension Research Council and Boettner Center at the Wharton School of the University of Pennsylvania.

Included in

Economics Commons



Date Posted: 13 February 2019