How does financial literacy influence undergraduates’ risk-taking propensity?

Previous evidence is contradictory about the financial literacy-individual’s risk-taking propensity relationship. Therefore, this article attempts to examine relationship between literacy and in a university environment, considering for first time literacy’s multidimensional nature (i.e., knowledge, attitude, behaviour). Applying Covariance-Based Structural Equation Models 568 Spanish undergraduates, our results show that: (1) knowledge behaviour directly positively affect propensity; (2) attitude indirectly affects through behaviour. These findings are relevant since they provide new insights into association mechanism that explains literacy-undergraduates’