Evidence of Student Achievement in a High School Personal ...

Download Evidence of Student Achievement in a High School Personal ...

Post on 30-Dec-2016

212 views

Category:

Documents

0 download

TRANSCRIPT

  • WORKINGPAPERNO.201301

    EvidenceofStudentAchievementina

    HighSchoolPersonalFinanceCourse

    By

    AndrewT.Hill,BonnieT.MeszarosandBrianTyson

    WORKING PAPER SERIES

  • TheviewsexpressedintheWorkingPaperSeriesarethoseoftheauthor(s)anddonotnecessarilyreflectthoseoftheDepartmentofEconomicsoroftheUniversityofDelaware.WorkingPapershavenotundergoneanyformalreviewandapprovalandarecirculatedfordiscussionpurposesonlyandshouldnotbequotedwithoutpermission.Yourcommentsandsuggestionsarewelcomeandshouldbedirectedtothecorrespondingauthor.Copyrightbelongstotheauthor(s).

  • EvidenceofStudentAchievementinaHighSchoolPersonalFinanceCourse

    AndrewT.Hill*EconomicEducationAdvisor

    FederalReserveBankofPhiladelphiaTenIndependenceMallPhiladelphia,PA19106

    Telephone:(215)5744392Fax:(215)5742512

    Email:andrew.hill@phil.frb.org

    BonnieT.MeszarosAssociateDirector

    CenterforEconomicEducationandEntrepreneurshipUniversityofDelaware102AlfredLernerHallNewark,DE19716

    Telephone:(302)8311896Fax:(302)8316659

    Email:meszaros@udel.edu

    BrianTysonGraduateStudent

    UniversityofTexasatAustinAustin,Texas78712

    December7,2012

    * TheviewsexpressedinthispaperarethoseoftheauthorsanddonotnecessarilyrepresentthoseoftheFederalReserveBankofPhiladelphiaortheFederalReserveSystem.TheauthorsthankSusheelaPatwariforvaluableresearchassistanceintheearlystagesofthisproject. Correspondingauthor.Atthetimethisresearchwasconducted,BrianTysonwasaresearchanalystattheFederalReserveBankofPhiladelphia.

  • 2

    EvidenceofStudentAchievementinaHighSchoolPersonalFinanceCourse

    Abstract

    ThisstudyinvestigatestheeffectoftheKeystoFinancialSuccesshighschoolpersonalfinance

    curriculumonstudentachievement.Itreliesonmultipleyearsofpreandposttestdatafrom1,701

    studentswhotookaKeyscourseandfromacomparisongroupof261studentsfromthesame

    schools.TheresultsfromthepreandposttestsshowthatstudentswhotaketheKeyscourseexhibita

    statisticallysignificantincreaseintheirpersonalfinanceachievement.Theseresultscontributetothe

    growingliteratureshowingthepositiveeffectsonthefinancialknowledgeofhighschoolstudentswhen

    theytakeawelldesignedcoursetaughtbyproperlytrainedteachers.

    Keywords:personalfinanceeducation,precollege,economiceducation,curriculum,assessment

    JELcodes:A2,A21,D14

  • 3

    INTRODUCTION

    Overthepastdecade,therehasbeenincreasedattentionontheneedtoincludepersonal

    financeinthehighschoolcurriculum.Thisperceivedneedhasbeenfueledbyarticlesfromthepopular

    press,statisticsontheimpactofpoorfinancialdecisionsmadebyyoungadults,andarticlesfromthe

    academiccommunity.Inaddition,thecallforfinancialeducationhasbeenreinforcedbyformerFederal

    ReserveChairmanAlanGreenspan(2001)andcurrentChairmanBenBernanke(2006).Whiletherehas

    beenagrowinginterestinofferingpersonalfinanceeducationintheK12classroom,thereislimited

    evidencethatpersonalfinanceinstructionincreasesstudentpersonalfinanceachievement.Thispaper

    explainsthefeaturesofahighschoolpersonalfinancecurriculumKeystoFinancialSuccess,whichis

    offeredbyaconsortiumofpartnersinDelaware,NewJersey,andPennsylvaniaandtheresultsfroma

    multiyearstudyofpreandposttestscoresfromstudentsinclassroomswithteacherswhousethe

    Keysmaterials.

    LITERATURE

    Today,morethananyothertime,individualsareexpectedtotakemoreresponsibilityfor

    handlingtheirpersonalfinancesandplanningfortheirretirement.Atthesametime,thefinancial

    servicesavailabletothemhavebecomemorecomplexandspecialized.Todaysconsumersfaceanarray

    ofsophisticatedproducts.Highlevelsofconsumerdebt,predatorylending,lowsavingsrates,an

    increaseinnonbusinessbankruptcyfilings,andexpandedaccesstocreditforyoungerpopulationsarea

    fewofthefactorscontributingtotheincreasedattentiontotheneedforpersonalfinanceeducation

    (BraunsteinandWelch,2002).Withtherecentfinancialcrisis,thefocusonafinanciallyliteratecitizenry

    hasmovedtocenterstage.Partoftheresponsibilitytoensurethatthisgoalisreachedrestswith

    AmericasK12schools.Studentsleavinghighschoolshouldbegroundedinthefundamentalsof

    personalfinancetobepreparedfortheirrolesasconsumers,savers,andinvestors.

  • 4

    Oneoftheimpactsofthepushforfinancialeducationintheschoolshasbeenanincreasein

    statesmandates.In2009,44statesincludedpersonalfinancetosomeextentintheirstateeducational

    standardsand34statesrequiredthatthesestandardsbeimplemented.Thirteenstatesnowrequire

    studentstotakeapersonalfinancecourseorincludepersonalfinanceinaneconomicscourseasahigh

    schoolrequirementforgraduation(CEE,2009).Havingmandatesdoesnotnecessarilytranslateinto

    studentachievement.TennysonandNguyen(2001)foundthatinstatesthathavebroadlydefined

    personalfinancemandates,studentsdidnotscorehigheronapersonalfinancetest.However,thosein

    statesthatrequiredaspecificfinancialeducationcoursescoredsignificantlyhigherthanstudentsin

    stateswithoutmandates.

    TheJump$tartCoalitionofPersonalFinancialLiteracybeganconductingbiannualnational

    testingofhighschoolstudentsin1997.Mandell(2008)reportsthatresultsfromthe2008Jump$tart

    surveywerediscouraging.Thesurveyfoundthatthefinancialliteracyofhighschoolseniorswasatits

    lowestlevelsincethefirstJump$tartsurveywasadministered.The2008averagescorewas48.3

    percent,downfromahighof57.3percentin1997.Infact,studentswhotookasemesterlonghigh

    schoolpersonalfinancecoursedidnotdobetterontheJump$tartexaminationthanthosewhodidnot

    takeapersonalfinancecourse.ThesefindingswerecitedbyWillis(2008)asareasonagainstfinancial

    literacyeducation.Shearguesthatthemoveformorepersonalfinanceeducationintheschoolsshould

    beabandonedandsuggestssearchingforpoliciesthatcouldleadmoredirectlytogoodconsumer

    financialoutcomes.MandellandKlein(2009)drewsimilarconclusionsandstatedthatuntilmore

    evidencewasavailablethatdemonstratedthatpersonalfinancecoursesatthehighschoollevel

    influencedsubsequentfinancialbehavior,theallocationofresourcestowardmandatoryclassesshould

    bereconsidered.

    MandellandKlein(2007)suggestthatstudentsretainlittleofwhattheylearninpersonal

    financebecausetheydontperceivethatitisrelevanttotheirlives.Motivationisacriticalfactorin

  • 5

    studentsbecomingfinanciallyliterate.Theauthorsconcludethatsuccessfulprogramsmustinclude

    instructiononsettingclearandobtainablegoalsandhelpingstudentsseehowbasicfinancialliteracy

    willallowthemtoreachtheirgoalsandaddvaluetotheirlives.Inaddition,MandellandKlein(2007)

    concludethatthepoorresultsontheJump$tartsurveyspointouttheneedforteachertrainingand

    betterinstructionalmaterials.However,thesesurveysdoshowthathighschoolstudentswhoplaya

    stockmarketgamearemorefinanciallyliteratethanstudentswhodonot(Mandell,2006).A2009

    studytoassesstheimpactoftheStockMarketGamefoundthatstudentswhoplayedthegamescored

    significantlyhigheronfinancialliteracyteststhantheirpeerswhodidnotplay(Hinojosaetal.,2008).

    MandellandKlein(2007)suggestthatthisimpliesthatpersonalfinanceclassesthataretaught

    interactivelyandareperceivedbythestudentstoberelevanttotheirlivesmaybemoreeffectivethan

    classesthatusemoretraditionalmethodsofinstruction.

    Asthedemandforpersonalfinanceeducationhasincreasedsohastheavailabilityof

    instructionalmaterials.Therehasbeenaproliferationofnonprofitorganizations,financialinstitutions,

    congressionalbills,andevenafederalcommissionpromotingfinancialliteracyinrecentyears.Manyof

    thesegroupsprovidefreeorinexpensiveinstructionalmaterialsforchildrenandadults.However,

    limitedresearchhasbeendoneontheeffectivenessofthesematerials.

    HathawayandKhatiwada(2008)foundthatmostresearchhasnotproventheeffectivenessof

    financialeducationprograms.Theyconcludethattherearetwolikelyreasonsforthis.First,the

    programsarenoteffectiveintransferringknowledgebecauseofeithertheirdesignorhowtheyare

    administered.Second,theprogramsarenotbeingevaluatedproperly.Althoughtheauthorsreviewed

    researchmainlyonadultprograms,theirfindingshaveimplicationsforpersonalfinanceeducation.

    HathawayandKhatiwada(2008)concludethatastandardbutadaptableframeworkforevaluationofall

    typesofliteracyprogramsisneeded.ThisissupportedbyFox,Bartholomae,andLee(2005)who

    recommendedJacobss(1988)fivetieredapproachtoevaluationwithapplicationsforpersonalfinance.

  • 6

    Walstad,Rebeck,andMacDonald(2010)alsostressedtheuseofJacobssmodelwhenevaluatingthe

    videobasedcurriculumFinancingYourFuture.Theyoutlinedthefivestagesforpersonalfinance

    programevaluation.First,setacleardefinitionofcontent.Second,trainteachersincontentanduseof

    programmaterials.Third,specifyknowledgeoutcomesthataremeasuredwithreliableandvalid

    instruments.Fourth,collectdataonpreandposttests.Fifth,rigorouslyanalyzedatausingappropriate

    formsofstatisticalanalysis.

    Thereareanumberofstudiesthathaveshownachangeinstudentachievementinpersonal

    financeafterexposuretoaspecificcurriculum.InasurveyofstudentswhocompletedtheHighSchool

    FinancialPlanningProgram,Todd(2002)foundthat,followingthetraining,50percentofthestudents

    reportedincreasesinfinancialknowledge.Thissupportsfindingsfromanearliersurvey(Boyceand

    Danes19971998)thatfoundthatstudentsfeelmorefinanciallyliterateafterthecompletionofthe

    personalfinancecourse.Varcoeetal.(2005)useda10itempreandposttrue/falsetesttodetermine

    theimpactoftheMoneyTalks:ShouldIBeListening?curriculumonstudentachievement.Theresults

    fromthetrue/falsetestsandtheselfreporteddataindicatedthatstudentswhoparticipatedinMoney

    Talksseemedtoimprovetheirfinancialknowledge.However,thesestudiesfailedtoincludeoneor

    moreofthestepsrecommendedinJacobss(1988)fivetierapproachtoevaluation.

    Severalstudieshaveusedamorerigorousapproachtoevaluationandhaveshownpromising

    results.Allhaveusedaquasiexperimentaldesignwithtreatmentandcomparisongroupsandhave

    providedteachertrainingusingaspecificcurriculumpackage.WalstadandRebeck(2005)developeda

    50itemmultiplechoicetesttomeasurestudentachievementbasedonthecontentinFinancialFitness

    forLife(FFL)(MortonandSchug,2001)apersonalfinanceandeconomicscurriculumpublishedbythe

    CouncilonEconomicEducation(formerlytheNationalCouncilonEconomicEducation).Afterreceiving

    trainingintheFFLcurriculum,highschoolteachersgaveapretest,taughtthelessons,andadministered

    aposttest.TheresultsshowedthatstudentsreceivinginstructionfromtrainedteachersusingFFLhad

  • 7

    higherachievementscoresthanstudentsinthecomparisongroup.HarterandHarter(2009)conducted

    astudyineasternKentuckytoassesstheeffectivenessoftheFFLlessonsinelementary,middle,and

    highschool.TeachersparticipatinginthestudyattendedaworkshopontheuseoftheFFLmaterials

    priortoteachingwiththemintheirownclassrooms.Atthehighschoollevel,studentgainsfromthe

    pretesttoposttestweresignificantwhencomparedwiththecomparisongroup.Swintonetal.(2007)

    examinedstudentscoresonGeorgiaseconomicsendofcoursetest.Studentsinclassroomswith

    teacherswhoattendedaFFLworkshopscoredsignificantlyhigherontherequiredendofcoursetest

    thanstudentstaughtbyteacherswhodidnotattendtheworkshop.Mostrecently,Walstad,Rebeck,

    andMacDonald(2010)conductedastudyontheeffectofstudentachievementofFinancingYourFuture

    (FYF),aseriesoffiveDVDs(CEE,2009).Preandposttestswereadministeredtotreatmentand

    comparisongroups.StudentstaughtwithFYFshowedastatisticallysignificantincreaseintheirpersonal

    financeknowledgeovertheirpeersinthecomparisongroup.

    KEYSTOFINANCIALSUCCESS

    Inthespringof2001,theUniversityofDelawareCenterforEconomicEducationand

    Entrepreneurship(Center),theFederalReserveBankofPhiladelphia,theDelawareBankersAssociation,

    andtheConsumerCreditCounselingServiceofMarylandandDelawareformedapartnershiptoprovide

    curriculumresourcesandteachertrainingtoDelawarehighschoolsinterestedinteachingasemester

    personalfinancecourse.Workcommencedinthelatespringandearlysummerof2001tocompilea

    90dayinstructionplanforahighschoolpersonalfinancecoursethatwouldmakeuseofexisting

    curriculumresources,approachtheteachingofpersonalfinanceusingmaterialsgroundedinthe

    economicwayofthinking,andallowthecoursetobeflexibleenoughtobetaughtbyteachersinthe

    socialstudies,familyandconsumerscience,mathematics,andbusinessdepartments.Theresulting

    courseplan,calledKeystoFinancialSuccess,makesextensiveuseoflessonsfromtheCouncilon

  • 8

    EconomicEducationswidelydistributedFFL(MortonandSchug,2001)andLearning,Earning,and

    Investing(LEI)(Caldwelletal.,2004)lessonbooks.Theselessonsmakeuseofactiveandcollaborative

    learningandareengagingforthestudents.Sincethesetwopackagesdidnotincludelessonsonspecific

    topicsofimportancetothepartners,suchasriskmanagement,goalsetting,andcareerplanning,

    lessonsweredevelopedbythestaffattheCenterandtheFederalReserveBankofPhiladelphiaorwere

    takenfromVISAsPracticalMoneySkills(2000).Tomotivatestudentsandaddrelevancetothecourse,

    studentsareaskedinthefirsttwounitstoresearchdifferentcareersandsetpersonalandfinancial

    goals.Basedontheirresearchandgoals,thestudents,withguidancefromtheteacher,selectacareer

    foruseduringthecourse.Thestudentsgoalsandcareerswithentrylevelwagesarerevisited

    throughouttheremainingunitsinthecourse.Studentsareaskedtoapplywhattheyhavelearnedusing

    theincomeassociatedwiththeirselectedcareeranddeterminehowtheirdecisionsimpacttheirgoals.

    Theintentofthisapproachistohelpstudentsseetherelevanceofbeingfinanciallyliteratebothnow

    andasadults.

    TheKeyscourseconsistsof54lessonsbuiltaroundninethemes:goalsanddecisionmaking,

    careersandplanning,budgeting,savingandinvesting,credit,bankingservices,transportationissues,

    housingissues,andriskprotection.Throughoutthecourse,studentsusetheInternetforaccesstothe

    latestinformationonpersonalfinancetopicsandfinancialproducts.Thisapproachallowsteachersto

    updatelessonsfromyeartoyeartoreflectchangesinthefinancialmarketplace.Usingknowledge

    gainedfromthelessonsandinformationgleanedfromtheInternet,studentscreateapersonalportfolio

    oftoolsanddata.Thestudentsareencouragedtokeeptheirportfoliosasareferencewhenmaking

    financialdecisionsafterhighschool.

    Participatingschoolscommittoofferingthecourseatleastonceperacademicyear.Teachers

    attendaweeklongtrainingcourseattheFederalReserveBankofPhiladelphiataughtbyindividuals

    fromtheCenterandtheFederalReserveBankofPhiladelphia.Theseeconomiceducatorshave

  • 9

    advanceddegreesineconomicsoreconomiceducationaswellasextensiveexperienceinteaching

    classesforteachers.

    Inthe20012002schoolyear,theKeyscoursewaspilotedinoneDelawarehighschool.As

    showninTable1,thepilotyearwasfollowedbytheadditionofsixschoolsinthe20022003school

    year,eightschoolsin20032004,andsixschoolsin20042005.Inthisperiod,atotalof26teachers

    weretrainedtoteachthecourse.Inthesefirstfouryears,onlyschoolsinDelawarewereparticipating.

    Beginninginthe20052006academicyear,schoolsinNewJerseyandPennsylvaniawererecruitedto

    participateintheprogram.InthesixschoolyearssincerecruitingbeganinNewJerseyand

    Pennsylvania,97schoolswereaddedtotheprogramand168additionalteachersweretrained.While

    newschoolswerecontinuingtoadopttheKeysprogramoverthisperiod,afewschoolsleftthe

    programeachyear.Theseattritionsfromtheprogramwereusuallyduetotheretirementofthe

    teacherwhohadtaughtthecourseorduetoschooladministratorsrealigningteachersschedulesto

    differentareas.

    [InsertTable1abouthere]

    STUDYDESIGN

    FromtheinceptionoftheKeystoFinancialSuccessprogram,thepartnersrecognizedthe

    importanceofmeasuringtheimpactofthecourseonthepersonalfinanceachievementofthestudents.

    A50questionpersonalfinancetestwasdevelopedbasedonthe50itemhighschoolmultiplechoice

    testpublishedbytheCouncilforEconomicEducationtoaccompanytheFinancialFitnessforLi...