Who's in? Household-targeted Government Policies and the Role of Financial Literacy in Market Participation
This paper examines how household-targeted government policies influence financial market participation conditional on financial literacy, focusing on potential Central Bank Digital Currency (CBDC) adoption. Due to the lack of empirical CBDC data, I use the introduction of retail Treasury bonds in Italy as a proxy to investigate how financial literacy affects households' likelihood to engage with the new instrument. Using the Bank of Italy's Survey on Household Income and Wealth, I explore how financial literacy influenced households' participation in the Treasury bond market following the 2012 introduction of retail Treasury bonds, showing that households with some but low financial literacy are more likely to participate than other household groups. Based on these findings, I develop a theoretical model to explore the potential implications of financial literacy for CBDC adoption, showing that low-literate households with limited access to risky assets allocate more wealth to CBDC, while high-literate households use risky assets to safeguard against income risk. These results highlight the role of financial literacy in shaping portfolio choices and CBDC adoption.
Code (0)
등록된 구현이 없습니다.
Similar Papers 제목 키워드 기반
Assessing Fiscal Policy Effectiveness on Household Savings in Hungary, Slovenia, and the Czech Republic during the COVID-19 Crisis: A Markov Switching VAR Approach
The COVID-19 pandemic significantly disrupted household consumption, savings, and income across Europe, particularly affecting countries like Hungary, Slovenia, and the Czech Republic. This study investigates the effecti…
Fiscal Policy and Household Savings in Central Europe (Poland, Croatia, and Slovak Republic) -- A Markov Switching VAR with Covid Shock
This study investigates the effectiveness of fiscal policies on household consumption, disposable income, and the propensity to consume during the COVID-19 pandemic across Croatia, Slovakia, and Poland. The purpose is to…
Community Bank Establishment and Consumption Growth: Evidence from Panel Study of Income Dynamics in USA
Consumption is a primary source of economic growth and key indicator of poverty. The establishment of community banks can provide credit resources, unlocking household consumption potential and playing a crucial role in …
Impact of Financial Inclusion on the Socio-Economic Status of Rural and Urban Households of Vulnerable Sections in Karnataka
Financial inclusion and inclusive growth are the buzzwords today. Inclusive growth empowers people belonging to vulnerable sections. This in turn depends upon a variety of factors, the most important being financial incl…
Factors Influencing Farmers' Motivation to Adopt Smart Farm Technology in South Korea
Smart farming technologies have recently become a major focus because they promise improved agricultural productivity together with sustainability benefits. The rate at which farmers adopt new technologies differs becaus…