Alfabetismo financiero y endeudamiento de los hogares en colombia

Abstract

ABSTRACT Among other issues, the 2008 financial crisis revealed a need for financial knowledge in the population, materializing the lack of criteria to understand the functioning of the financial system (Ayhan, 2019). Furthermore, Van Ooijem & Van Rooij (2016) state that the limited understanding of mortgages and their risks contributed to the outbreak of said crisis. In this sense, Kefela (2011) points out that education is essential for people to manage their financial affairs, thus contributing to the soundness of the system. In this line, Oliver-Márquez et al. (2021) explore the measurement of financial knowledge from a macroeconomic perspective, to assess its effects on development and inequality. Thus, it is valuable to study the level of financial knowledge in societies as a starting point to design strategies that help mitigate such crises. For more than twenty years, researchers such as Lusardi & Mitchell (2011), Sekita (2011), Beckman (2013) or Morgan & Trinh (2020), have been conducting studies on the influence of financial knowledge on decision-making related to personal finances, for example, savings or retirement. Countries such as the United Kingdom, Australia, Japan or the United States have developed and implemented Financial Education (FE) strategies taking into account its importance for the economic stability of the population (Andujar, 2019). In Latin America, efforts are more recent. The first to develop a national FE strategy was: Brazil in 2010; Uruguay and Ecuador in 2012; Honduras and Paraguay in 2015; Chile, Colombia, Mexico and Peru in 2017 and Argentina in 2019 (OECD/CAF, 2020). In Colombia, particularly the exploration of the subject has been minimal as evidenced in chapter 2 of this thesis, which represents an opportunity for its study and scientific discussion. Consequently, the objective of this thesis is, on the one hand, to identify the determinants of financial literacy and, on the other, to analyze the relationship between household indebtedness and wealth with the degree of financial knowledge. To achieve this objective, the thesis is based on the population of Bogotá; administrative and financial center of the country. Likewise, the following hypotheses are proposed to be tested: * Hypothesis 1: Demographic and social characteristics determine the degree of financial knowledge of households. * Hypothesis 2: Financial knowledge influences the level of indebtedness of the population. The data is processed using two measurement instruments: the “Gran Encuesta Integrada de Hogares” and the “Encuesta de Carga y Educación Financiera”, which allow obtaining information on the socioeconomic situation of families (DANE, 2015). The study methodology is based on a combination of an exploratory, quantitative and qualitative approach, all based on a review of the available literature. Thus, different logistic regression econometric models are developed that articulate the variables related to financial knowledge, the demographic profile of households and family debt. In the first phase of the work Chapter 1, the relevance of the research is justified. In Chapter 2, the necessary context is developed to be able to materialize the study. In Chapter 3, a diagnosis is made, evaluating the degree of financial knowledge of the population. The results are based on the analysis of three knowledge variables: inflation, interest rate and risk diversification. These three study topics were chosen and tested by Lusardi & Mitchell (2014). In addition, the hypotheses related to the differences between financial literacy and demographic characteristics are evaluated (Hypothesis 1); the incidence of factors such as age, gender, income and marital status of the population is assessed. Subsequently, and as a complement, a qualitative analysis of the knowledge about the nature and impact of the proposed tax reforms in the country is carried out, specifically the financial understanding of the impact of fiscal policies on their personal finances. Finally, Chapter 4 determines the relationship between financial knowledge and indebtedness patterns (Hypothesis 2); variables such as: the household's decision to use debt, have a mortgage, non-bank debt, and the number of loans are included. This study emanates empirical results from Bogotá, the most representative city in the country. Colombia is an emerging economy, where financial education is an essential asset for decision-making and improving financial behavior. As a corollary, the development of this thesis can contribute to the achievement of the sustainable development goals (SDG) proposed by the United Nations Organization (UN), in its 2030 agenda . Particularly, in its purpose of eradicating poverty and providing quality education. The thesis lays the foundations to promote financial knowledge within the framework of a sustainable standard of living. These aspects are contemplated within SDG 1, SDG 4 and SDG 12.