Up to the end of the 1990s, the OECD’s comparisons of education outcomes were mainly based on measures of years of schooling, which don’t necessarily reflect what people actually know and can do. The Programme for International Student Assessment (PISA) changed this. The idea behind PISA lay in testing the knowledge and skills of students directly, through a metric that was internationally agreed upon; linking that with data from students, teachers, schools and systems to understand performance differences; and then harnessing the power of collaboration to act on the data, both by creating shared points of reference and by leveraging peer pressure.
The OECD countries that initiated PISA tried to make PISA different from traditional assessments. In a world that rewards individuals increasingly not just for what they know, but for what they can do with what they know, PISA goes beyond assessing whether students can reproduce what they have learnt in school. To do well in PISA, students have to be able to extrapolate from what they know, think across the boundaries of subject-matter disciplines, apply their knowledge creatively in novel situations and demonstrate effective learning strategies. If all we do is teach our children what we know, they might remember enough to follow in our footsteps; but if they learn how to learn, and are able to think for themselves, and work with others, they can go anywhere they want.
Starting from the core subjects of mathematics, reading and science, PISA expanded over time to other key life skills for students, from problem solving to creative thinking. Financial literacy is now also recognised as a life skill for the 21st century, ensuring students have the ability to make sound financial decisions as they grow into responsible adults, navigate an ever-changing financial landscape and cope with emerging risks. PISA undertook its first financial literacy assessment in 2012, focusing on the knowledge and understanding that 15-year-olds across the world have of money matters. Building upon initial results and financial education work globally, the scope of the financial literacy assessment has been expanded to look not only at students’ financial knowledge, attitudes and behaviours, but also at how parents, schools and peers can help students improve their financial literacy.
Over the past two decades, PISA has become the world’s premier yardstick for comparing quality, equity and efficiency in learning outcomes across countries, and an influential force for education reform. PISA has helped policy makers lower the cost of political action by backing difficult decisions with evidence – but it has also raised the political cost of inaction by exposing areas where policy and practice have been unsatisfactory.
This also holds true for financial literacy. Over the last 15 years, the PISA financial literacy assessment has become the reference point for efforts to define, evaluate and improve financial competences among young people worldwide, even among countries that did not participate in PISA tests. For example, frameworks defining the financial competences that children and young people should possess, such as the Financial Competence Framework for Children and Youth in the European Union, developed by the OECD and the European Commission, take the PISA financial literacy analytical and assessment framework as the starting point. The results of the PISA financial literacy assessment have influenced financial education policy and have prompted many countries to improve the way they teach financial literacy to students.
PISA 2022 was the fourth round of the international financial literacy assessment, with twenty OECD and partner countries and economies taking part, including eight countries participating for the first time. Every PISA financial literacy test assesses students’ financial knowledge, attitudes, behaviours and skills, and PISA 2022 also captures a wider range of aspects, including the influence of friends on 15-year-old students’ financial decisions and behaviours.
These latest PISA financial literacy results show that while most 15-year-old students are already consumers of financial products and services, many still lack some of the skills and knowledge that are needed to make sound financial decisions for themselves. This publication suggests ways in which common issues can be addressed to improve students’ financial literacy, and ultimately create the adequate conditions for students’ financial well-being now and as they become adults.
Countries and economies that take part in PISA are culturally diverse and have attained different levels of economic development. Nevertheless, they face a common challenge--to support children and young people, in particular the most vulnerable and low-performing ones, so they can reach their full potential as learners and human beings, and fully participate in economic life. Results from the PISA financial literacy assessment highlight that socio-economically disadvantaged students are over-represented among low performers in financial literacy, calling for policy action to avoid inequalities rising as these students become adults. PISA provides the evidence and the policy insights that countries need to address these matters. There is an urgent need for action. The task for governments is to help education systems rise to this challenge.
Carmine Di Noia,
Director for Financial and Enterprise Affairs
Andreas Schleicher,
Director for Education and Skills
Special Advisor on Education Policy to the Secretary-General