2012-05: Financial literacy learning in emerging markets: Agent-based modeling (Working paper)

Abstract

Financial literacy is a critical determinant of household well-being. We use an agent-based modelling approach to analyse the impacts of financial literacy programs delivered from sources of varying degrees of credibility through a social network in emerging economies. The simulation results indicate that the social networks of emerging markets rely heavily on source credibility to grow and sustain financial literacy levels. The results illustrate that financial education programs undertaken without regard for the context of the key social networks or source credibility neglect a main source of information flow and validation which can lead to program failure.