Could Financial Literacy Overcome Price Information Asymmetry: Empirical Study
Could Financial Literacy Overcome Price Information Asymmetry: Empirical Study

Author(s): Ivan Soukal, Jan Draessler
Subject(s): Business Economy / Management, Evaluation research
Published by: Masarykova univerzita nakladatelství
Keywords: retail core banking services; financial literacy; optimal choice; empirical study;
Summary/Abstract: Our empirical study is focused on retail core banking services provided through the payment account and financial literacy. Financially literate consumer makes sound financial decisions and so we study on the real market if the optimal choice is made. There are factors that make the choice more difficult due to demand on monetary literacy such as various pricing, tariff complexity and links between products. We perform wide empirical study with a sample of 14 484 individual consumer payment account usage records to study the magnitude of the consumer decision making problem. Our results show very low share of optimal choices defined by the range of individually demanded services and the lowest price. The 95% confidence interval of optimal share is only (0,159; 0,171).

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