Financial Literacy in the Age of Green Investment
45 Pages Posted: 5 Apr 2019 Last revised: 18 Nov 2021
Date Written: November 16, 2021
We survey a large sample of Swedish households and connect the responses to administrative data to relate pro-environmental attitudes and values to actual investment decisions. Pro-environment households are not more likely to hold pro-environment portfolios. This results from financial disengagement: they are less likely to own stocks, check pension balances, or make green active retirement planning choices. Green financial engagement is stronger in settings where financial literacy is higher or where informational hurdles are lower. Informational barriers appear to prevent financial market prices and returns from fully reflecting household environmental preferences.
Keywords: Household finance; Sustainability; Financial literacy; Retirement savings
JEL Classification: G02; G11; G18
Suggested Citation: Suggested Citation