Gender Differences in Financial Literacy and Confidence Calibration among Punjabi Graduates: Evidence from the Big Three

Abstract

This study examined the level of basic financial literacy using the “Big Three” questions developed by Lusardi and Mitchell in 2004, as well as the perceived financial knowledge.  For this study, data have been collected from 126 respondents of Punjab who had minimally graduated with a bachelor’s degree in any stream. Results revealed that there are minor gender differences in basic financial literacy (p > 0.05); however, males reported higher self-rated knowledge, indicating overconfidence among them. Females’ performance on risk diversification (F3) is better than while males outperformed on the inflation question (F2). Females are more prone to choose “Don’t Know” than their male peers. 61.1 percent of individuals show underconfidence, while gender differences are not significant in calibration (p=0.721). These results showed that the gender gap is mostly caused by how people think they are good with finances, rather than by what they know. This study suggests financial education that focuses on both concepts and creating confidence. These kinds of initiatives can help both men and women make better financial decisions in line with India’s National Strategy for Financial Education (2020–2025).