Is School-Based Financial Education Effective? Immediate and Long-Lasting Impacts on High School Students

Abstract

Relying on a large-scale experiment in Peru, this study evaluates the effects of an in-class intervention on financial literacy and financial behavior. As soon as the program is over, treated students record significant financial literacy gains that do not hinder their academic performance. The program also leads to immediate changes in downstream financial behavior as measured by financial autonomy and financial savviness. Credit bureau records gathered three years later show that early improvements in financial literacy translate into limited, but positive long-lasting changes in financial behavior. The treatment did not affect students’ credit or repayment behavior on the extensive margin, but, among those few with outstanding loans, it reduced arrears by 20%.