Shanghai students are tops on financial knowhow
WASHINGTON (AP) — China leads the pack when it comes to the financial knowledge and skills of 15-year-old boys and girls, according to an international study released Wednesday.
Shanghai had the highest average score for teens in 18 countries who participated in the testing for the Paris-based Organization for Economic Cooperation and Development.
The Chinese city was followed by the Flemish Community of Belgium, Estonia, Australia, New Zealand, the Czech Republic, Poland, Latvia, the U.S., Russia and France.
At the bottom of the list: Croatia, Israel, the Slovak Republic, Italy and Colombia.
The testing is part of OECD’s Program for International Student Assessment, which aims to evaluate education systems worldwide. This is the program’s first assessment of financial literacy of teens.
The questions on the two-hour paper test ranged from simple to complex.
The easiest questions asked students to display basic financial literacy skills, such as recognizing the purpose of an invoice or comparing prices per unit to determine which had a better value.
The most difficult asked students to analyze more complicated scenarios, such as reviewing two loan proposals with differing rates and terms and choosing the better offer.
Shanghai notched the top average score of 603 points. The U.S., by comparison, had an average score of 492, and Colombia, at the bottom, scored 379.
So what is Shanghai doing right?
Michael Davidson, head of schools for the OECD, says Shanghai schools identify students who are struggling and provide the support they need. Successful systems, he said, don’t let students fall behind.
The financial literacy study was administered in 2012 to approximately 29,000 15-year-old students in 13 OECD countries and economies and five partner countries and economies.
The OECD’s Davidson said grounding in financial literacy is crucial to teens preparing to decide whether to enter the job market or embark on college and university educations.
Many, he said, already use financial products. In the U.S., for example, about 50 percent of the 15-year-olds said they have a bank account. About 15 percent said they have a prepaid debit card.