TITLE:
Family Wealth Accumulation and Fiscal Prudence among China’s Young Adults: Between the Privileged and the Common
AUTHORS:
Muyan Xie
KEYWORDS:
Financial Literacy, Financial Behavior, Wealth Accumulation, Chinese Young Adults
JOURNAL NAME:
Open Journal of Social Sciences,
Vol.9 No.9,
September
22,
2021
ABSTRACT: Young adults in middle class Chinese families are seeing increased access
to their family’s wealth. With the growing
ubiquity of digital payments and consumer
goods, they are spending at an ever increasing rate. But for young adults from less privileged financial backgrounds,
high disposable incomes and glamorous shopping items may be out of
reach. This paper is designed to analyze the development of financial literacy
among all groups of young adults in China and assess the rationality of their
financial behavior. I sought to determine
the correlations between financial literacy, family income and fiscal prudence.
I applied methods like OLS regression, entropy weight model and significance test to establish firm correlations. I
hypothesized children of wealthier families
would behave in a more financially reasonable way as they tend to have
access to more education and general financial information. Thus, I would test
using initial hypothesis that more privileged children will react and shop more
prudently, which is further proved in the sections below.