Socioeconomic determinants of financial education in the Province of Cusco, Peru

Abstract

The objective of the research was to determine and analyze the socioeconomic factors of financial education through the following indicators: household economy index, index of financial attitudes and behaviors and index of financial concepts and knowledge. For data collection, a questionnaire was used to measure financial capabilities based on the methodology used by the Development Bank of Latin America, applied to people between 18 and 80 years of age in the province of Cusco, and after data analysis, the indexes were calculated. For the econometric analysis, a multiple linear regression model was developed with robust statistics to measure the degree of relationship between socioeconomic factors and financial education. The results showed that the level of financial education in the province of Cusco is medium-high, explained by favorable results in two of three indexes (index of financial attitudes and behaviors and the index of financial concepts and knowledge); however, there is room for improvement in the household economy index, due to poor family budget planning. Finally, it was identified that the factors that have the greatest impact on financial education are educational level and income level.