Exploring financial graph literacy: determinants and influence on financial behavior
Abstract
Purpose
Graphs are widely used in the banking and finance domain to support consumers’ decision-making process, but subjects differ in their ability to understand them. This study aims to detect the determinants of the ability to read and process financial information conveyed in the graphical format, i.e. financial graph literacy (FGL) and the relationship between FGL and subjects’ actual financial behavior (FB).
Design/methodology/approach
Data are collected by administering a structured questionnaire to the Italian adult population (n = 502). The survey includes different sections aimed at collecting information about sociodemographic and socioeconomic variables, financial literacy and FB. The econometric analyses are developed using OLS and Poisson regressions.
Findings
The results show that gender, geographical area, education, marital status and income are crucial determinants of FGL. Moreover, the analysis reveals that an increase in the FGL indicator is associated with a higher propensity for individuals to purchase banking or financial products or actively manage financial resources; results are robust, even controlling for financial knowledge.
Originality/value
Although previous research investigates the impact of graphs in financial decision-making, no studies measure the ability of consumers to read and interpret financial information conveyed in the graphical format. This study is the first to investigate the determinants of FGL and link it to actual FB. Implications for policymakers, regulatory and supervisory authorities and financial intermediaries are discussed.
Keywords
Acknowledgements
The authors would like to express their sincere gratitude to Professors Lucia Leonelli, Gianni Nicolini and Vincenzo Farina for their invaluable suggestions and insights, which have greatly contributed to the development of this work.
Funding: The authors declare that no funds, grants or other support were received during the preparation of this manuscript.
Declarations of interest: none.
All authors contributed to the study conception and design. Material preparation, data collection and analysis were performed by all the authors. All authors read and approved the final manuscript.
Citation
Barone, M., Bussoli, C. and Fattobene, L. (2024), "Exploring financial graph literacy: determinants and influence on financial behavior", Qualitative Research in Financial Markets, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/QRFM-12-2023-0304
Publisher
:Emerald Publishing Limited
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