China's teens lead world for financial know-how
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 yesterday.
Shanghai had the highest average score out of representative groups in 18 countries who participated in the testing for the Paris-based Organisation for Economic Cooperation and Development (OECD).
Shanghai was followed by the Flemish community of Belgium, Estonia, Australia, New Zealand, the Czech Republic, Poland, Latvia, the US, Russia and France.
At the bottom of the list were Croatia, Israel, the Slovak Republic, Italy and Colombia. The testing was part of the Programme for International Student Assessment, which aims to evaluate education systems worldwide.
This is the programme's first assessment of the financial literacy of teens. The questions in the two-hour written test ranged from simple to complex.
The easiest questions asked students to display basic financial literacy skills, such as recognising the purpose of an invoice or comparing prices per unit to decide which was better value.
The most difficult questions involved students analysing more complex 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 US had an average score of 492 and Colombia, at the bottom, scored 379.
Michael Davidson, head of schools for the OECD, said Shanghai schools identified students who were struggling and provided the support they needed. Successful systems, he said, did not let students fall behind.
The financial literacy study was administered in 2012 to about 29,000 15-year-old students in 13 OECD countries and economies and five partner countries and economies.
Davidson said grounding in financial literacy was crucial to teens preparing to decide whether to enter the job market or embark on college and university educations.
Many, he said, already used financial products. In the US, for example, about 50 per cent of the 15-year-olds said they had a bank account. About 15 per cent said they had a prepaid debit card.