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Fictional Money, Real Costs: Impacts of Financial Salience on Disadvantaged Students

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  • Claire Duquennois

Abstract

Disadvantaged students perform differentially worse when randomly given a financially salient mathematics exam. For students with socioeconomic indicators below the national median, a 10 percentage point increase in the share of monetary themed questions depresses exam performance by 0.026 standard deviations, about 6 percent of their performance gap. Using question-level data, I confirm the role of financial salience by comparing performance on monetary and highly similar non-monetary questions. Leveraging the randomized ordering of questions, I identify an effect on subsequent questions, providing evidence that the attention capture effects of poverty affect policy relevant outcomes outside of experimental settings.

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  • Claire Duquennois, 2022. "Fictional Money, Real Costs: Impacts of Financial Salience on Disadvantaged Students," American Economic Review, American Economic Association, vol. 112(3), pages 798-826, March.
    • Handle: RePEc:aea:aecrev:v:112:y:2022:i:3:p:798-826
    DOI: 10.1257/aer.20201661
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    Cited by:

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    2. Posso, Christian & Saravia, Estefanía & Uribe, Pablo, 2023. "Acing the test: Educational effects of the SaberEs test preparation program in Colombia," Economics of Education Review, Elsevier, vol. 97(C).
    3. Griselda, Silvia, 2024. "Gender gap in standardized tests: What are we measuring?," Journal of Economic Behavior & Organization, Elsevier, vol. 221(C), pages 191-229.
    4. Silvia Griselda, 2020. "Different Questions, Different Gender Gap: Can the Format of Questions Explain the Gender Gap in Mathematics?," 2020 Papers pgr710, Job Market Papers.
    5. Supreet Kaur & Sendhil Mullainathan & Suanna Oh & Frank Schilbach, 2021. "Do Financial Concerns Make Workers Less Productive?," NBER Working Papers 28338, National Bureau of Economic Research, Inc.
    6. Li, Hongbin & Meng, Lingsheng & Mu, Kai & Wang, Shaoda, 2024. "English language requirement and educational inequality: Evidence from 16 million college applicants in China," Journal of Development Economics, Elsevier, vol. 168(C).
    7. Maulik Jagnani & Claire Duquennois, 2023. "Financial concerns and sleeplessness," French Stata Users' Group Meetings 2023 09, Stata Users Group.
    8. Sharafi, Zahra, 2023. "Poverty and perseverance: The detrimental effect of poverty on effort provision," Journal of Development Economics, Elsevier, vol. 162(C).
    9. Timothée Demont & Daniela Horta Sáenz & Eva Raiber, 2023. "Turning worries into cognitive performance: Results from an online experiment during Covid," AMSE Working Papers 2302, Aix-Marseille School of Economics, France.
    10. Anaya, Lina & Iriberri, Nagore & Rey-Biel, Pedro & Zamarro, Gema, 2022. "Understanding performance in test taking: The role of question difficulty order," Economics of Education Review, Elsevier, vol. 90(C).
    11. Eva Raiber & Daniela Horta Saenz & Timothée Demont, 2023. "Turning worries into performance: Results from an online experiment during COVID," French Stata Users' Group Meetings 2023 08, Stata Users Group.

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    More about this item

    JEL classification:

    • G53 - Financial Economics - - Household Finance - - - Financial Literacy
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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