Willingness-to-pay for financial literacy education in Texas Public schools: A contingent valuation method study
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It is a complex assignment to value the monetary return of education. The problem addressed in this study was the lack of knowledge with regard to the value placed on financial literacy education in Texas public high schools. This study demonstrates the use of a technique of economic analysis based on welfare economics called Contingent Valuation Method. This economic tool is used for estimating the value that a person places on an intangible, non-market good or service. In this study the contingent valuation method is used to obtain an estimate of the value of the implementation of financial literacy education in Texas public schools. A survey was developed, pre-tested, pilot tested and administered on-line to a sample of Texas Parent Teacher Association (Texas PTA) members. From a sample of approximately 3,100 Texas PTA members’ there were a total of 279 usable responses from April 1, 2005 to May 12, 2005. The majority of the subjects who participated in the study were Caucasian/white, female, predominantly married, between the ages of 40-49, employed either full- or part-time, had median annual income of $75,000 to $99,000, and were homeowners with mortgages. The results of the study suggest that Texas PTA members’ are willing to pay four cents (4.3) to five cents (5.4) per $100 in property taxes in addition to the $1.55 per $100 in property taxes they currently pay, for the implementation of financial literacy education in Texas public schools. Furthermore, results indicate that Texas PTA members’ believe there is insufficient funding for financial literacy education in Texas public schools. For the most part, additional gambling venues and an increase in state sales tax proved to be acceptable revenue sources for added funding for education. On the other hand, a state income tax proved to be the least preferred revenue source for further funding of education. When looking at items which make up the financial satisfaction scale, preparedness for emergencies and level of debt proved to be the statistically significant components of the scale. These findings with regard to financial satisfaction suggest that as Texas PTA members’ willingness-to-pay for financial literacy increases, their reported overall degree of financial satisfaction tends to decline.