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  • Financial Literacy Measurement in PISA 2012


    Aveiro, July 3 ‐ 4, 2012

    Dusan Hradil

  • Financial Literacy Measurement in PISA 2012 AGENDA

    Financial literacy option in PISA 2012 - basic facts

    FL in PISA 2012

    Organization of the domain - Contents, Contexts and Processes

    Examples of the items

    Disclaimer: information in this presentation is based on publicly available data or express private opinion, estimates or expectation of the author; the author speaks neither for the OECD nor for the Financial Expert Group

  • Financial Literacy Measurement in PISA 2012 PISA BASIC FACTS

    PISA (Programme for International Student Assessment) is an international study which began in 2000 since 2000 over 70 countries and economies have participated

    aims to evaluate education systems worldwide by testing knowledge and skills of 15-year-old students in participating countries

    assesses how far students (near the end of compulsory education) have acquired some of the knowledge and skills that are essential for full participation in society

    PISA goes beyond school curriculum - the domains are covered not merely in terms of mastery of the school curriculum, but in terms of important knowledge and skills needed in adult life

    assessment conducted every 3-year 3 domains: reading, maths and science 2012: focus on mathematics + new domain: financial literacy

  • Financial Literacy Measurement in PISA 2012 FINANCIAL LITERACY IN PISA 2012

    Why FL in PISA 2012?

    FL generally recognized as one of the key competencies relevant not only for the future but also for young age OECD 2005 recommendation: FE should start at school level projects/programmes should be accompanied by a baseline survey and be

    further monitored (development and outcomes) but currently only a limited data on FL level of students with no

    international comparability

  • Financial Literacy Measurement in PISA 2012 FINANCIAL LITERACY IN PISA 2012

    What type of outcomes do we get? cross-country comparison – scores and proficiency scales (500, STD 100) FL scores vs. economic, social and cultural background FL vs. math and reading scores FL vs. behaviour (fin. products, saving habits) FL vs. information/education – schools and out-of-school

    Why to join PISA 2012? set FE strategies, define the content and identify priorities start evaluation process - change over time (effectiveness)adjustments international comparison high level of FL good practice common challenges and solutions

    Who is already on board?Australia, Belgium (Flemish Community), Brazil (only the 2011 field trial), Shanghai-China, Colombia, Croatia, Czech Republic, Estonia, France, Israel, Italy, Latvia, New Zealand, Poland, Russia, Slovak Republic, Slovenia, Spain and United States

  • Financial Literacy Measurement in PISA 2012 FINANCIAL LITERACY IN PISA 2012

    PISA 2012 Financial Literacy Assessment Framework FL definition Financial literacy is knowledge and understanding of financial concepts,

    and the skills, motivation and confidence to apply such knowledge and understanding in order to make effective decisions across a range of financial contexts, to improve the financial well-being of individuals and society, and to enable participation in economic life.

    basic knowledge essential + experience from family accessing information, comparing and contrasting, extrapolating and

    evaluating some math and language skills non-cognitive attributes important – motivation to seek for information

    and advice; confidence to engage in financial activities effective = informed and responsible real-life financial situations – familiar with or can imagine personal financial literacy vs. member of society

  • Financial Literacy Measurement in PISA 2012  FINANCIAL LITERACY IN PISA 2012

    FL in PISA 2012 2010 – development of the framework and test items 2011 – field trial 2012 – data collection 2013/2014 – final report

    The booklets 4 clusters – 2 FL, 1 Math, 1 Reading – rotation 60 minutes of FL test items cognitive and non-cognitive items multiple choice – simple or complex constructed response – word, figure, calculation, explanation coded by trained judges full credit or partial credit

  • Financial Literacy Measurement in PISA 2012 ORGANIZATION OF THE DOMAIN

    knowledge and understanding

    understand, analyse and evaluate


  • Financial Literacy Measurement in PISA 2012 ORGANIZATION OF THE DOMAIN

    Content areas of knowledge and understanding inspired by existing FL frameworks 4 content categories in PISA 2012 FL domain:

    1. money and transactions- coins and notes; different ways of making payments; correct change;

    understanding personal financial records e.g. bank statements2. planning and managing finance

    - budgeting; priorities, wants and needs; long- and short-term perspectives; building wealth through investment in education;borrowing and saving

    3. risk and reward- limiting risk of financial losses and understanding inherent risks in financial products (non-numeric)

    - compounding4. financial landscape

    - choices, changes and consequences, understanding the content oflegal documents, consumer rights and responsibilities, scams and fraud

  • Financial Literacy Measurement in PISA 2012 MONEY AND TRANSACTIONS

  • Financial Literacy Measurement in PISA 2012 PLANNING AND MANAGING FINANCE

  • Financial Literacy Measurement in PISA 2012 RISK AND REWARD

  • Financial Literacy Measurement in PISA 2012 FINANCIAL LANDSCAPE

  • Financial Literacy Measurement in PISA 2012 ORGANIZATION OF THE DOMAIN

    Processes relate to cognitive processes describe the students‘ ability to recognise and

    apply concepts relevant to the domain and to understand, analyse, reason about, evaluate and suggest solutions

    4 parallel processes categories in PISA 2012 FL domain:

    1. identify financial information- finding information; financial knowledge (financial terms)

    2. analyse information in a financial context- recognizing sth. that is not explicit; comparing and contrasting financial products

    3. evaluate financial issues- explaining, assessing and generalising; assessing consequences of financial decisions; discriminating between discretionary and necessary spending

    4. apply fin. knowledge and understanding- making calculations, solving financial problems (multiple conditions), taking effective action

  • Financial Literacy Measurement in PISA 2012 IDENTIFY FINANCIAL INFORMATION

  • Financial Literacy Measurement in PISA 2012 ANALYZE INFORMATION IN A  FIN. CONTEXT 

  • Financial Literacy Measurement in PISA 2012 EVALUATE FINANCIAL ISSUES 

  • Financial Literacy Measurement in PISA 2012 APPLY FIN. KNOWLEDGE AND UNDERSTANDING 

  • Financial Literacy Measurement in PISA 2012 ORGANIZATION OF THE DOMAIN

    Contexts financial decisions depend on the context or situation situations familiar to 15-year-olds 4 context categories in PISA 2012 FL domain:

    1. individual- responsibilities borne by individual; decisions for personal benefit - personal financial products, buying electronics or sport equipment

    2. home and family- running a household, shared accommodation, family budgets

    3. education and work- understanding payslips, taking student loans, saving from salary, investing in education

    4. societal- the environment people are living in- consumer rights and responsibilities - taxes, charity

  • Financial Literacy Measurement in PISA 2012 INDIVIDUAL 

  • Financial Literacy Measurement in PISA 2012 NON‐COGNITIVE ITEMS 

    Non-cognitive components of FL definition motivation and confidence4 non-cognitive factors1. Access to information and education2. Access to money and financial products3. Attitudes towards and confidence about financial matters4. Spending and saving behaviour

  • Thank you for your attention

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    Financial Literacy Measurement �in PISA 2012Slide Number 2Slide Number 3Slide Number 4Slide Number 5Slide Number 6Slide Number 7Slide Number 8Slide Number 9Slide Number 10Slide Number 11Slide Number 12Slide Number 13Slide Number 14Slide Number 15Slide Number 16Slide Number 17Slide Number 18Slide Number 19Slide Number 20Slide Number 21Thank you for your attention