We just talked recently about a potential special issue of JET around teaching financial literacy. This sounds like a great future article and collaboration!
Yes! I agree and I'm happy to read this! Lack of knowledge is one of the smallest barriers I've found in my work, and all the tools you mentioned are vital and available to teach and share. And...we explore A LOT in sessions and workshops about thoughts/emotions surrounding the value of money, early money experiences, money shame, why we think certain things, and what is underpinning our actions. And more, because as another commenter wrote, it's a deep topic.
I appreciate the approach and book highlights. The book is part of my library for financial coaches, and I'll look at the Money Secret system. I support any system that elevates the highly personal nature of personal finance along with the mechanics.
I tell my students that Behavioral Economics is a great start, but it is still stuck in the past. It is not that human behavior is a branch of economics -- economics is the study of how humans allocate resources in accordance with what they want. Note I do not say "benefit" -- for the obvious reason that what people want is not always good for them (the story about gambling and hookers is instructive). So I always change "cost-benefit analysis" to "cost-utility analysis", using Léon Walras' description:
"I state that things are useful as soon as they may serve whatever usage, as soon as they match whatever need and allow its fulfillment. Thus, there is here no point to deal with 'nuances' by way of which one classes, in the language of everyday conversation, utility beside what is pleasant and between the necessary and the superfluous. Necessary, useful, pleasant and superfluous, all of this is, for us, more or less useful. There is here as well no need to take into account the morality or immorality of the need that the useful things matches and permits to fulfill. Whether a substance is searched for by a doctor to heal an ill person, or by an assassin to poison his family, this is an important question from other points of view, albeit totally indifferent from ours. The substance is useful, for us, in both cases, and may well be more useful in the second case than in the first one."
A rich topic with great depth. I need to listen to it again and again. It astonished me to learn about the topic. Glad you put a recommendation of a book to read. I will definitely need to work on my financial literacy skills.
We just talked recently about a potential special issue of JET around teaching financial literacy. This sounds like a great future article and collaboration!
That would be awesome!
Yes! I agree and I'm happy to read this! Lack of knowledge is one of the smallest barriers I've found in my work, and all the tools you mentioned are vital and available to teach and share. And...we explore A LOT in sessions and workshops about thoughts/emotions surrounding the value of money, early money experiences, money shame, why we think certain things, and what is underpinning our actions. And more, because as another commenter wrote, it's a deep topic.
I appreciate the approach and book highlights. The book is part of my library for financial coaches, and I'll look at the Money Secret system. I support any system that elevates the highly personal nature of personal finance along with the mechanics.
Thank you for checking out MoneySecret!
I tell my students that Behavioral Economics is a great start, but it is still stuck in the past. It is not that human behavior is a branch of economics -- economics is the study of how humans allocate resources in accordance with what they want. Note I do not say "benefit" -- for the obvious reason that what people want is not always good for them (the story about gambling and hookers is instructive). So I always change "cost-benefit analysis" to "cost-utility analysis", using Léon Walras' description:
"I state that things are useful as soon as they may serve whatever usage, as soon as they match whatever need and allow its fulfillment. Thus, there is here no point to deal with 'nuances' by way of which one classes, in the language of everyday conversation, utility beside what is pleasant and between the necessary and the superfluous. Necessary, useful, pleasant and superfluous, all of this is, for us, more or less useful. There is here as well no need to take into account the morality or immorality of the need that the useful things matches and permits to fulfill. Whether a substance is searched for by a doctor to heal an ill person, or by an assassin to poison his family, this is an important question from other points of view, albeit totally indifferent from ours. The substance is useful, for us, in both cases, and may well be more useful in the second case than in the first one."
A rich topic with great depth. I need to listen to it again and again. It astonished me to learn about the topic. Glad you put a recommendation of a book to read. I will definitely need to work on my financial literacy skills.