Vilsa Curto

Financial Literacy among the Young

We examined financial literacy among the young using data from the 1997 National Longitudinal Survey of Youth. We showed that financial literacy is low among the young; fewer than one-third of young adults possess basic knowledge of interest rates, inflation, and risk diversification. Financial literacy is strongly related to sociodemographic characteristics and family financial sophistication. Specifically, a college-educated male whose parents had stocks and retirement savings is about 50 percentage points more likely to know about risk diversification than a female with less than a high school education whose parents were not wealthy. These findings have implications for consumer policy.

The Potential of Urban Boarding Schools for the Poor: Evidence from SEED

The SEED schools, which combine a “No Excuses” charter model with a 5-day-a-week boarding program, are America’s only urban public boarding schools for the poor. We provide the first causal estimate of the impact of attending SEED schools on academic achievement, with the goal of understanding whether changing a student’s environment is an effective strategy to increase achievement among the poor. Using admission lotteries, we show that attending a SEED school increases achievement by 0.211 standard deviation in reading and 0.229 standard deviation in math per year. However, subgroup analyses show that the effects may be driven by female students.

Financial literacy and financial sophistication in the older population

Using a special-purpose module implemented in the Health and Retirement Study, we evaluate financial sophistication in the American population over the age of 50. We combine several financial literacy questions into an overall index to highlight which questions best capture financial sophistication and examine the sensitivity of financial literacy responses to framing effects. Results show that many older respondents are not financially sophisticated: they fail to grasp essential aspects of risk diversification, asset valuation, portfolio choice, and investment fees. Subgroups with notable deficits include women, the least educated, non-Whites, and those over age 75. In view of the fact that retirees increasingly must take on responsibility for their own retirement security, such meager levels of knowledge have potentially serious and negative implications.

Early ACA Medicaid Expansions: Impacts on Enrollment and Access

We use four states that were early adopters of Medicaid expansion to study how this expansion affects enrollment and access to physicians for Medicaid enrollees. We use the universe of Medicaid enrollment and claims data to construct state-month-level measures of enrollment, enrollee composition, and access to physicians. Using a differences-in-differences framework, we find that Medicaid expansion leads to a 13 percent increase in overall enrollment, a 27 percent increase in enrollment among adults ages 23 to 65, and a 7 percent increase in the number of Medicaid patients seen by physicians. We find no statistically significant increase in the number of Medicaid patients seen among obstetricians/gynecologists and pediatricians, who are less likely to be affected by the expansion. We find that Medicaid expansion increases physician participation on the intensive margin but not on the extensive margin.