PATHWAYS TO FINANCIAL AUTONOMY: THE INTERPLAY OF FINANCIAL SOCIALIZATION AND CAPABILITY IN WOMEN

Riya Gupta; Shailendra Singh Bhadouria

doi:10.29121/shodhkosh.v5.i1.2024.3082

Authors

Riya Gupta Research Scholar, Department of Commerce, Indira Gandhi National Tribal University Amarkantak, M.P.
Shailendra Singh Bhadouria Professor, Department of Commerce, Indira Gandhi National Tribal University Amarkantak, M.P.

DOI:

https://doi.org/10.29121/shodhkosh.v5.i1.2024.3082

Keywords:

Financial Socialization, Financial Capability, Financial Autonomy, Mediation Analysis

Abstract [English]

Financial autonomy is a critical aspect of women’s empowerment, enabling them to make independent financial decisions and achieve economic self-reliance. This research evaluates the mediating role of financial capability in the association between financial socialization and financial autonomy among women in Uttar Pradesh, India. The primary objectives are to analyze the effect of financial socialization on financial capability, assess the relationship between financial capability and financial autonomy, and analyze the mediating role of financial capability. Data were collected between January 2024 and March 2024 from 438 women aged 18 years and above in the districts of Varanasi, Lucknow, Unnao, and Jaunpur, using a structured questionnaire. After data cleaning, 420 responses were deemed fit for analysis. Convenience sampling was used to collect data from respondents. The questionnaire measured financial socialization, capability, and autonomy using a 5-point Likert scale. Mediation analysis was conducted using SPSS PROCESS Macro Version 4.2. The results disclose that financial socialization significantly influences financial capability, which, in turn, strongly predicts financial autonomy. Financial capability mediates 62.2% of the total effect of financial socialization on financial autonomy, confirming its critical role. The research underscores the importance of financial education programs, family discussions, and policy intercessions to improve financial socialization and capability. These findings have practical implications for empowering women and promoting gender equality by fostering financial independence and decision-making capabilities. Future research should explore these dynamics across diverse populations and longitudinal settings.

References

Allen, M.W. (2008), “Consumer finance and parent–child communication”, in Xiao, J.J. (Ed.), Handbook of Consumer Finance Research, Springer, New York, NY, pp. 351-361. DOI: https://doi.org/10.1007/978-0-387-75734-6_21

Atkinson, A., McKay, S., Collard, S., & Kempson, E. (2007). Levels of financial capability in the UK. Public Money & Management, 27(1), 29–36. https://doi.org/10.1111/j.1467-9302.2007.00552.x DOI: https://doi.org/10.1111/j.1467-9302.2007.00552.x

Baltes, M. M., and Silverberg, S. B. 1994. The dynamics between dependency and autonomy: Illustrations across the life span. In: Featherman, D. L., Lerner, R. M., Perlmutter, M. (Eds.), Life-span Development and Behavior, 12, Hillsdale, NJ: Erlbaum, pp. 41-90. DOI: https://doi.org/10.4324/9781315789255-2

Botha, F., Broadway, B., de New, J. P., & Wong, C. (2020). Financial autonomy among emerging adults in Australia, 30/20. DOI: https://doi.org/10.2139/ssrn.3754057

Bowman, D., Banks, M., Fela, G., Russell, R., & De Silva, A. (2017). Understanding financial wellbeing in times of insecurity. In Brotherhood of St Laurence (issue April).

Britt, S. (2016), “The intergenerational transference of money attitudes and behaviours”, Journal of Consumer Affairs, 50(3), 539-556. DOI: https://doi.org/10.1111/joca.12113

Collins, W. A., Gleason, T., & Sesma, A., Jr. (1997). Internalization, autonomy, and relationships: Development during adolescence. In J. E. Grusec, & L. Kuczynski (Eds.), Parenting and children's internalization of values: A handbook of contemporary theory (pp. 78–99). John Wiley & Sons.

Danes, S. M., & Haberman, H. R. (2007). Teen Financial Knowledge, Self-Efficacy, and Behavior: A Gendered View. Journal of Financial Counseling and Planning, 18(2), 48–60. http://6aa7f5c4a9901a3e1a1682793cd11f5a6b732d29.gripelements.com/pdf/7-2866-volume-18-issue-2.pdf

Drever, A.I., Odders-White, E., Kalish, C.W., Else-Quest, N.M., Hoagland, E.M. and Nelms, E.N. (2015), “Foundations of financial well-being: insights into the role of executive function, financial socialization, and experience-based learning in childhood and youth”, Journal of Consumer Affairs, 49(1), 13-38. DOI: https://doi.org/10.1111/joca.12068

Duflo, E. and Saez, E. (2003), “The role of information and social interactions in retirement plan decisions: evidence from a randomized experiment”, The Quarterly Journal of Economics, 118(3), 815-842. DOI: https://doi.org/10.1162/00335530360698432

Duflo, E. (2012). Women empowerment and economic development. Journal of Economic Literature, 50(4), 1051–1079. https://doi.org/10.1257/jel.50.4.1051 DOI: https://doi.org/10.1257/jel.50.4.1051

Garrison, S.T. and Gutter, M.S. (2010), “Gender differences in financial socialization and willingness to take financial risks”, Journal of Financial Counseling and Planning, 21(2), 60-72.

Glenn, C.E. (2018), The Influence of Financial Socialization on Young Adults, Ph.D. Doctor of Philosphy, Kansas State University, Manhattan, KA.

Jariwala, H. V. (2020). Effect of perception differences in money communication between parent-adolescents on financial autonomy: An experimental study using financial education workshops. Applied Finance Letters, 9(SI), 23–43. https://doi.org/10.24135/AFL.V9I2.241 DOI: https://doi.org/10.24135/afl.v9i2.241

Jariwala, H. V., & Dziegielewski, S. F. (2016). Pathway to Financial success: Autonomy through Financial education in India. Journal of Social Service Research, 43(3), 381–394. https://doi.org/10.1080/01488376.2016.1217581 DOI: https://doi.org/10.1080/01488376.2016.1217581

Jariwala, H. V., & Sharma, M. S. (2013). Assessment of behavioural outcomes of financial education workshops on financial behaviour of the participants: An experimental study. Journal of Financial Services Marketing, 18(3), 241–256. https://doi.org/10.1057/FSM.2013.17 DOI: https://doi.org/10.1057/fsm.2013.17

Johnson, E., & Sherraden, M. S. (2007). From financial literacy to financial capability among youth. The Journal of Sociology & Social Welfare, 34(3). https://doi.org/10.15453/0191-5096.3276 DOI: https://doi.org/10.15453/0191-5096.3276

Jorgensen, B. L., Rappleyea, D. L., Schweichler, J. T., Fang, X., & Moran, M. E. (2017). The financial behavior of emerging adults: A family financial socialization approach. Journal of Family and Economic Issues, 38(1), 57–69. https://doi.org/10.1007/S10834-015-9481-0 DOI: https://doi.org/10.1007/s10834-015-9481-0

Jorgensen, B.L. and Savla, J. (2010), “Financial literacy of young adults: the importance of parental socialization”, Family Relations, 59(4), 465-478. DOI: https://doi.org/10.1111/j.1741-3729.2010.00616.x

Khan, K. A., Çera, G., & Alves, S. R. P. (2022). Financial Capability as a Function of Financial Literacy, Financial Advice, and Financial Satisfaction. E+M Ekonomie a Management, 25(1), 143–160. https://doi.org/10.15240/tul/001/2022-1-009 DOI: https://doi.org/10.15240/tul/001/2022-1-009

Kim, J., LaTaillade, J. and Kim, H. (2011), “Family processes and adolescents’ financial behaviors”, Journal of Family and Economic Issues, 32(4), 668-679. DOI: https://doi.org/10.1007/s10834-011-9270-3

Noom, M. J., Dekovic, M., and Meeus, W., 2001. Conceptual analysis and measurement of adolescent autonomy. Journal of Youth and Adolescence 30 (5), 577-595. DOI: https://doi.org/10.1023/A:1010400721676

OECD. (2013). Barriers to women’s financial empowerment and factors affecting gender differences in financial literacy. In https://www.oecd-ilibrary.org. https://www.oecd-ilibrary.org/docserver/9789264202733-6-en.pdf?expires=1733517427&id=id&accname=guest&checksum=34D92AAA80CC14CF8C467C6692A032B5

Rea, J.K., Danes, S.M., Serido, J., Borden, L.M. and Shim, S. (2019), ““Being able to support yourself”: young adults’ meaning of financial well-being through family financial socialization”, Journal of Family and Economic Issues, 40(2), 250-268. DOI: https://doi.org/10.1007/s10834-018-9602-7

Sherraden, M. (2013). Building blocks of financial capability. In Oxford University Press eBooks (pp. 3–43). https://doi.org/10.1093/acprof:oso/9780199755950.003.0012 DOI: https://doi.org/10.1093/acprof:oso/9780199755950.003.0012

Shim, S. and Serido, J. (2011), “Young adults’ financial capability APLUS, wave 2”, available at: www.nefe.org/Portals/0/WhatWeProvide/PrimaryResearch/PDF/APLUSWave2_Final.pdf (accessed 10 February 2017).

Shim, S., Barber, B.L., Card, N.A., Xiao, J.J. and Serido, J. (2010), “Financial socialization of first-year college students: the roles of parents, work, and education”, Journal of Youth and Adolescence, 39(12), 1457-1470. DOI: https://doi.org/10.1007/s10964-009-9432-x

Shim, S., Xiao, J.J., Barber, B.L. and Lyons, A.C. (2009), “Pathways to life success: a conceptual model of financial well-being for young adults”, Journal of Applied Developmental Psychology, 30(6), 708-723. DOI: https://doi.org/10.1016/j.appdev.2009.02.003

Steinberg, L., & Silverberg, S. B. (1986). The vicissitudes of autonomy in early adolescence. Child Development, 57(4), 841. https://doi.org/10.2307/1130361 DOI: https://doi.org/10.2307/1130361

Van Campenhout, G. (2015), “Revaluing the role of parents as financial socialization agents in youth financial literacy programs”, Journal of Consumer Affairs, 49(1), 186-222. DOI: https://doi.org/10.1111/joca.12064

Webley, P. and Nyhus, E. (2006), “Parents’ influence on children’s future orientation and saving”, Journal of Economic Psychology, 27(1), 140-164. DOI: https://doi.org/10.1016/j.joep.2005.06.016

Xiao, J. J., & Huang, J. (2021). Financial Capability: A conceptual review, extension, and synthesis. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3943629 DOI: https://doi.org/10.2139/ssrn.3943629

Xiao, J. J., Chatterjee, S., & Kim, J. (2014). Factors associated with financial independence of young adults. International Journal of Consumer Studies, 38(4), 394–403. https://doi.org/10.1111/IJCS.12106 DOI: https://doi.org/10.1111/ijcs.12106

Zhao, H., & Zhang, L. (2020). Talking money at home: the value of family financial socialization. International Journal of Bank Marketing, 38(7), 1617–1634. https://doi.org/10.1108/ijbm-04-2020-0174 DOI: https://doi.org/10.1108/IJBM-04-2020-0174