Maybe you’ve heard news media reports noting that women lag behind men in understanding finances. What is the evidence for such gender differences in knowledge and understanding of finances. According to economist Annamaria Lusardi, it depends on how you ask. In a study of women and men in 8 countries, Dr. Lusardi asked three simple questions about finances. Here is one:
Buying a single company’s stock usually provides a safer return than a stock mutual fund.
- do not know
- refuse to answer
In many countries (but not all), more men than women choose the correct answer (false). But, more women than men choose ‘do not know.’ Consistent with this finding, men gave themselves higher scores than women, even when their actual knowledge is not higher.
So, it seems that in finance as in other domains, women are aware of their lack of knowledge and men are less willing to admit what they don’t know.