Hostname: page-component-586b7cd67f-r5fsc Total loading time: 0 Render date: 2024-11-25T00:54:58.905Z Has data issue: false hasContentIssue false
  • English
  • Français

Financial literacy and retirement preparation in the Netherlands*

Published online by Cambridge University Press:  11 October 2011

ROB ALESSIE ,
MAARTEN VAN ROOIJ  and
ANNAMARIA LUSARDI
ROB ALESSIE
Affiliation:
University of Groningen, Tinbergen Institute and Netspar
MAARTEN VAN ROOIJ
Affiliation:
Dutch Central Bank and Netspar
ANNAMARIA LUSARDI*
Affiliation:
The George Washington University School of Business and Netspar
*
(e-mail: [email protected])
Get access Rights & Permissions [Opens in a new window]

Abstract

We present new evidence on financial literacy and retirement preparation in the Netherlands based on two surveys conducted before and after the onset of the financial crisis. We document that while financial knowledge did not increase from 2005 to 2010, in 2010 significantly more individuals report having thought about their retirement. Using information on financial conditions and financial knowledge of relatives, we find a positive causal effect of financial literacy on retirement preparation. Employing the panel feature of our dataset, we show that the effect of financial knowledge on retirement planning is bound to be positive.

Keywords

D91D80Financial sophisticationretirement planning
Type
Articles
Information
Journal of Pension Economics & Finance , Volume 10 , Issue 4 , October 2011 , pp. 527 - 545
Copyright
Copyright © Cambridge University Press 2011

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Footnotes

*

Rob J.M. Alessie, School of Economics and Business, University of Groningen, P.O. Box 800, 9700 AV, Groningen ([email protected]), Maarten C.J. van Rooij, Economics and Research Division, De Nederlandsche Bank, P.O. Box 98, 1000 AB, Amsterdam ([email protected]), and Annamaria Lusardi, The George Washington University School of Business, 2201 G Street, NW, Washington, DC 20052 ([email protected]). We thank Franco Peracchi, the participants of the CeRP Workshop on Financial Literacy around the World (Turin, Italy, December 2010), the participants of the Mathematical and Statistical Methods for Actuarial Sciences and Finance conference (Ravello, Italy, April 2010) for useful comments and suggestions, and Audrey Brown for editorial assistance. We are grateful to the staff of CentERdata, in particular Stephanie Mertens, for their assistance in setting up the survey and the field work. Financial support from Netspar is gratefully acknowledged. The views expressed in this paper are those of the authors and do not necessarily reflect the views of the Dutch Central Bank.

References

Aigner, D. (1973) Regression with a binary independent variable subject to errors of observation. Journal of Econometrics, 1: 49–60.CrossRefGoogle Scholar
Alessie, R., van Rooij, M. and Lusardi, A. (2011) Financial literacy, retirement preparation and pension expectations in the Netherlands. DNB Working Paper No. 289.Google Scholar
Arruñada, B. (2010) Protestants and Catholics: similar work ethic, different social ethic. Economic Journal, 120: 890–918.CrossRefGoogle Scholar
Freeman, R. (1983) Longitudinal analyses of the effects of trade unions. NBER Working Paper No. 1207.CrossRefGoogle Scholar
Lusardi, A. and Mitchell, O. (2007) Baby boomers retirement security: the role of planning, financial literacy and housing wealth. Journal of Monetary Economics, 54: 205–224.CrossRefGoogle Scholar
Lusardi, A. and Mitchell, O. (2011) Financial literacy and planning: implications for retirement wellbeing. In: Lusardi, A. and Mitchell, O. (eds), Financial Literacy: Implications for Retirement Security and the Financial Marketplace. Oxford: Oxford University Press, forthcoming.Google Scholar
McCrea, S., Liberman, N., Trope, Y. and Sherman, S. (2008) Construal level and procrastination. Psychological Science, 19: 1308–1314.CrossRefGoogle ScholarPubMed
Renneboog, L. and Spaenjers, C. (2011) Religion, economic attitudes, and household finance. Oxford Economic Papers, forthcoming.Google Scholar
Van Rooij, M., Kool, C. and Prast, H. (2007) Risk-return preferences in the pension domain: are people able to choose? Journal of Public Economics, 91: 701–722.CrossRefGoogle Scholar
Van Rooij, M., Lusardi, A. and Alessie, R. (2011 a) Financial literacy and stock market participation. Journal of Financial Economics, 101(2): 449–472.CrossRefGoogle Scholar
Van Rooij, M., Lusardi, A. and Alessie, R. (2011 b) Financial literacy and retirement planning in the Netherlands. Journal of Economic Psychology, forthcoming.CrossRefGoogle Scholar