(UM10-08) - Cognitive Function and Financial Knowledge: A Human Capital Approach
Robert J. Willis, Kandice Kapinos and Brooke Helppie McFall
This project builds on previous work (Delavande, Rohwedder and Willis, 2008) that develops a formal model of financial knowledge accumulation and establishes evidence on the role of cognition in financial knowledge, using rich data from the Cognitive Economics (CogEcon) survey. We add new data from a 2009 “post-crash” survey to examine how financial exposure, financial knowledge, and wealth are related to increasing financial knowledge and economic behavior in uncertain economic conditions. This research will increase understanding of the myriad effects of the financial crisis on older Americans’ retirement preparedness and economic decision-making.