Fed/GFLEC Financial Literacy Seminar Series

March 21, 2019

3:30 PM - 5:00 PM

Seminar II | Trading Stocks Increases Financial Literacy and Compresses the Confidence Gender Gap


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Saumitra Jha

Associate Professor of Political Economy, Stanford Graduate School of Business


George Washington University School of Business
Duquès Hall, Minerva Room (451)
2201 G Street NW
(main entrance is on 22nd Street between G and H Streets)

Bio: Saumitra Jha

Saumitra Jha is an Associate Professor of Political Economy at the Stanford Graduate School of Business, Professor, by courtesy, of Economics and of Political Science, and a Senior Fellow at the Center for Democracy, Development and the Rule of Law. Saum holds a BA from Williams College, master’s degrees in economics and mathematics from the University of Cambridge, and a PhD in economics from Stanford University. Prior to returning to Stanford, he was an Academy Scholar at Harvard University. Saum has been a Fellow of the Niehaus Center for Globalization and Governance and the Center for the Study of Democratic Politics at Princeton University and received the Michael Wallerstein Award for best published article in Political Economy from the American Political Science Association in 2014 for his research on ethnic tolerance. Saumitra has consulted on economic and political risk issues for the United Nations/ WTO, the World Bank and other organizations.


How can we help individuals handle financial decisions in an increasingly complex environment? We explore an easily scalable avenue for improving financial understanding: learning by online trading in stocks. We randomly assign 1345 adults incentives and opportunities to trade stocks for 4-7 weeks, with no additional educational content. The treatment significantly improves financial literacy and attenuates the gender gap in self-assessed financial knowledge. Treated individuals are more likely to subsequently invest in stocks and less likely to seek external advice. The effects strengthen for those exposed to index funds, foreign assets, and rising or more volatile asset prices.