Cross-National Cultural Effects on PISA Financial Literacy Achievements

• In Event: Context, Culture, and Pedagogy: Rethinking Educational Effectiveness Across Diverse Settings

Proposal

Cross-National Cultural Effects on PISA Financial Literacy Achievements
Theoretical Framework & Study Purpose
Financial literacy is defined as the capacity to apply knowledge and skills to real-life financial decision-making, enabling individuals to participate fully in economic and social life (OECD, 2023; Lusardi & Mitchell, 2014). It has gained prominence as a key competence in navigating increasingly complex financial environments, with significant implications for equity, lifelong learning, and economic participation. Prior studies document substantial cross-national variation in financial literacy outcomes, often explained by economic conditions and educational resources (Amagir et al., 2020; Cupák et al., 2021). However, comparative educational research suggests that national culture also plays a pivotal role in shaping educational outcomes (Feniger & Lefstein, 2014; Hofstede et al., 2010). Against this backdrop, the present study pursues two aims: first, to examine whether high- and low-achieving countries differ systematically in their cultural profiles, using Hofstede’s six dimensions of national culture; and second, to identify which cultural dimensions most strongly predict students’ financial literacy performance in PISA 2022, after controlling for GDP per capita and the GINI coefficient. In doing so, the study aims to highlight culture as a macro-level determinant that interacts with economic structures in shaping educational performance.
By examining how cultural values intersect with economic structures in shaping educational outcomes, the study deepens understanding of the roots of financial literacy disparities. In this way, it directly addresses issues of redistribution, resource allocation, and equity central to the Economics and Finance of Education SIG, while also engaging broader debates on social justice and the ways education may either mitigate or reinforce structural inequalities.
Method
This study draws on data from the Programme for International Student Assessment (PISA) 2022 financial literacy domain, administered to nationally representative samples of approximately 98,000 15-year-old students across 20 participating countries and economies (OECD, 2023). Students’ financial literacy scores were modeled using the ten plausible values provided by the OECD, with analyses conducted separately for each and aggregated in line with recommended procedures to ensure valid population estimates. Sampling weights were applied to adjust for the complex survey design (OECD, 2023). National cultural values were measured using Hofstede’s six-dimensional framework—power distance, individualism, motivation (i.e., masculinity), uncertainty avoidance, long-term orientation, and indulgence—drawing on updated indices from the Culture Factor Group (2023). National economic conditions were incorporated as controls through GDP per capita (PPP) and the GINI coefficient, obtained from World Bank databases. To account for the nested structure of the data, we estimated two-level multilevel models with students nested within countries, followed by independent samples t-tests and correlation analyses to compare high- and low-performing country groups (cf. Pulk & Riitsalu, 2024). This analytic design enabled us to assess whether cultural dimensions predict adolescents’ financial literacy outcomes above and beyond countries’ financial standing.
Results
Analyses revealed systematic differences in cultural profiles between high - and low -performing countries. High-performing countries scored significantly higher on individualism (t = 2.33, p<.05) and long-term orientation (t =2.91, p<.01), while low-performing countries tended to display higher power distance values. Multilevel models indicated that long-term orientation emerged as the strongest cultural predictor of adolescents’ financial literacy outcomes across the full sample (β=1.27, SE=.51, p<.05), accounting for a substantial proportion of the between-country variance. Inclusion of the cultural dimensions reduced the intraclass correlation coefficient (ICC) from .15 to .03, underscoring their explanatory contribution. In the fully adjusted model, uncertainty avoidance was also positively associated with performance (β =0.54, SE=.20, p<.05), while other dimensions yielded no significant effects. Among the control variables, GDP per capita was positively associated with financial literacy (β= 0.0001, SE=0.0001, p<.05), whereas the GINI coefficient showed a strong negative association (β=–3.43, SE=0.70, p<.001). Together, these findings suggest that cultural dimensions, particularly long-term orientation, exert meaningful and independent effects on cross-national variation in financial literacy, even after accounting for economic conditions.
Discussion & Implications
The findings highlight national culture as a meaningful macro-level determinant of adolescents’ financial literacy, with long-term orientation and uncertainty avoidance emerging as significant predictors beyond economic wealth and inequality. These results suggest that policies aimed at improving financial literacy cannot rely solely on material investments but must also attend to the cultural environments that shape financial socialization and learning (Cupák et al., 2021; Pulk & Riitsalu, 2024).
For the Economics and Finance of Education agenda, the study underscores three implications. First, culturally tailored financial education—emphasizing planning and perseverance in future-oriented societies, or risk-awareness in high uncertainty-avoidance contexts—may enhance cost-effectiveness and equity. Second, cross-national policy borrowing should consider cultural compatibility, as curricula or teacher training programs that succeed in low power-distance, individualistic systems may be less effective in hierarchical or collectivist contexts (Ahunov & Van Hove, 2020; Johnson et al., 2024). Third, evaluation frameworks for financial education should integrate context-sensitive benchmarks, avoiding assumptions of universality that risk obscuring structural inequalities (Feniger & Lefstein, 2014; Hanushek & Woessmann, 2023). By situating culture alongside economic factors, this study contributes to more nuanced resource allocation strategies and policy designs, offering insights for both high- and low-performance countries seeking to strengthen financial competence among youth.
 

Authors

• Rachel Feldman, Bar Ilan University

• Pascale benoliel, Bar Ilan University