FINANCIAL FRAGILITY AND FINANCIAL

OPTIMISM LINKAGE DURING COVID-19:

DOES FINANCIAL LITERACY MATTER?
RESEARCH RECONSTRUCTION

Presentation by
Ryan (G11460016) and Rachel (G11460707)

Programming Design | 2023 Tunghai University

 INTRODUCTION
FINANCIAL 2720 PARTICIPANTS
LITERACY INVOLVED
University of Southern
California
FINANCIAL 6 survey questions related
FRAGILITY FINANCIAL to personal financial
DURING THE OPTIMISM condition, US business
conditions, and county-
COVID-19 level business conditions
 INTRODUCTION
This research benefits :

POLICYMAKERS FINANCIAL LITERACY INDIVIDUALS

AND ECONOMISTS EDUCATORS AND THEMSELVES
ADVOCATES
See the impacts of the Understand how
To understand the general
pandemic, the side financial literacy and
level of financial literacy
effects, to learn more and fragility can help
and understanding among
discover a better way to them in uncertain
adolescents
promote economic times.
recovery.
 BACKGROUND
In Chronological Order

Peak
COVID 19
unemployment Decline in GDP
Pandemic
rate

In this study, these 3 events happened chronologically, one right after

the other. These events led to an economic downturn, and there is a
clear delay in expenditure.
PROBLEM

Previous research has discovered that

a delay in expenditure occurs when
individuals' feel pessimistic toward
future economic prospects.
 THEORETICAL FRAMEWORK
OVERVIEW
It is essential to stop the decline
in financial optimism to keep
driving household consumption,
saving, and the continuous
creation of investment decisions.
HYPOTHESIS
Financial literacy is considered
to be an important moderating
factor, to increase the accuracy
of individuals' ability to forecast
the upcoming economic
condition
 CATCH UP SLIDE

THIS
RESEARCH
 WHAT WE LEARNED

INPUT PROCESS OUTPUT

 DEFINING THE VARIABLES

DEPENDENT VARIABLE UNCONTROLLABLE VARIABLE

Age
Financial optimism
Gender
Education
INDEPENDENT VARIABLE Income
Financial Fragility Marital status
Financial Literacy Employment status
Life Expectancy Measure
 METHODOLOGY
BINARY LOGISTIC
REGRESSION Due to the binary nature of the dependent
QUANTITATIVE variables.
ANALYSIS

WHY NOT Because the values of the variables are not

A LINEAR consistent, in other words, it does not have
REGRESSION? a linearly increasing / decreasing value.
THE DIFFERENCE
 GATHERING INPUT

DATA COLLECTION VALUES

Financial Optimism Index
0 to 1
Personal finance condition
Business condition in the US
Better (1), About the
Business condition in the
same, or worse
County
STATISTICAL ANALYSIS
REGRESSION
 RESULTS
There is a negative correlation between financial fragility and financial
optimism, with financial fragility having a 7% impact.
Age, gender, income, and education do not have a significant influence on
financial optimism.
Socioeconomic status does not play a role in affecting financial fragility
and financial literacy.
Individuals who are financially fragile but literate tend to exhibit higher
levels of financial optimism.
Financial literacy helps reduce the impact of financial fragility on financial
optimism.
 THANK YOU
Presentation by
Ryan (G11460016) and Rachel (G11460707)

Programming Design | 2023 Tunghai University