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What effect Does the Stock Market Game have on Financial Literacy?

Wesley D. Marshall EDSS 8420 Dr . Caroline Sullivan. What effect Does the Stock Market Game have on Financial Literacy?. Financial illiteracy is widespread and profound (Lusardi, 2008). Financial illiteracy is correlated with poor physical and emotion health (Jorgensen, Salva, 2008).

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What effect Does the Stock Market Game have on Financial Literacy?

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  1. Wesley D. Marshall EDSS 8420 Dr. Caroline Sullivan What effect Does the Stock Market Game have on Financial Literacy?

  2. Financial illiteracy is widespread and profound (Lusardi, 2008). Financial illiteracy is correlated with poor physical and emotion health (Jorgensen, Salva, 2008). Financial illiteracy is correlated with a host of unhealthy behavioral habits (Adams, Moore, 2007). High school is the last opportunity for most low-income students to receive financial education (Grimes et al., 2010). Literature Review – Main Points

  3. Financial literacy correlates with self-benefitting financial behavior later in life (Mandell, 2008) The Stock Market Game (SMG) correlates positively with financial literacy (Mandell, 2008). The extent to which the SMG improves financial literacy is dubious (Maier, Nelson, 2007). Social learning theory is the epistemological assumption underlying the study (Bandura, 1986). Literature Review - Main Points

  4. The Pre-test – Jump$tart Coalition for Personal Financial Literacy (13 questions). 10 Students Identified to Participate: 5 with SMG supplement and 5 in standard economics course. 30 minute interview about the SMG, economics course and their perceptions of it’s influence. The Post-test – the “Personal Finance” Domain of the economics End-of-Course-Test (EOCT). Methodology

  5. 1) “There was too much information in the course.” 2) “The book confused me by over-explaining concepts” 3) “The information was too abstract especially the macroeconomics” 4) “The information was hard to relate to practical life and the real-world” 5) “Most of the material for which we studied was never tested”, Qualitative Themes – economics course

  6. 1) “The SMG was more entertaining than the bookwork” 2) “The SMG showed me how complex stock-buying is.” 3) “The SMG helped me understand investment noticeably better than the book.” 4) The SMG helped me understand credit/borrowing only slightly better than the book.” 5) The SMG didn’t help me learn anything about budgeting or saving.” Qualitative Themes - SMG

  7. Quantitative Data

  8. Students perceived that SMG taught investment concepts substantially better than the book Students perceived that SMG elucidated credit/borrowing slightly better than the book Students perceived no qualitative difference between on budgeting and savings. Average gain from SMG is 60.25%. The average gain from non-SMG course is 69.4%. Most students have not taken final test. Sample size is small. The study cannot be generalized Results

  9. Conduct fundraiser for fees, if necessary. • Make SMG mandatory • Alter SMG rules to improve realism. • Focus the economics course and SMG more towards financial literacy • Permission has already been granted. • Determine the extent to which financial illiteracy exists in graduating seniors from Cherokee county. • Encourage county to evaluate data and adjust curriculum. Conclusions and Action

  10. Adams, T., & Moore, M. (2007). High-risk health and credit behavior among 18- to 25- year- old college students. Journal of American College Health, 56(2), 101-108. Retrieved from ERIC database. Bandura, A. (1986). Social foundations of thought and action: A social cognitive theory. EnglewoodCliffs, NJ: Prentice-Hall. Jorgenson, B., & Salva, J. (2010). Financial literacy of young adults: The Importance of Parental Socialization. Family Relations, 59(4), 465-478. Retrieved from ERIC database. Lusardi, A. (2008). Financial literacy: an essential tool for informed consumer choice? Retrieved from EconLit database. Mandell, Lewis. (2008). Financial education in high school. In A. Lusardi (Ed.), Overcoming the Saving Slump: (pp. 257-270) Chicago: The University of Chicago Press. Maier, M., Nelson, J. (2007). Introducing Economics: A Critical Guide for Teaching. Armonk, New York: M.E. Sharpe Publishing References

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