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Behavioral Insights into Financial Decision Making
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Behavioral Insights into Financial Decision Making

A special issue of International Journal of Financial Studies (ISSN 2227-7072).

Deadline for manuscript submissions: closed (31 March 2026) | Viewed by 12945

Editor

Prof. Dr. Aaron Gilbert

E-Mail Website
Guest Editor
Department of Finance, Faculty of Business, Economics and Law, Auckland University of Technology, 42 Wakefield Street, Auckland 1010, New Zealand
Interests: household finance; financial literacy; banking; investment
Special Issues, Collections and Topics in MDPI journals

Special Issue Information

Dear Colleagues,

Understanding the psychological, emotional, and cognitive dimensions of financial decision making is increasingly vital for both scholars and practitioners. Traditional models rooted in rational choice often fall short in capturing the complexities of real-world financial behavior. This Special Issue seeks to advance research at the intersection of finance, psychology, and behavioral economics, with a focus on how individuals and households make financial decisions across a range of contexts.

A growing dimension of this field is the influence of digital technologies, from mobile banking apps and robo-advisors to algorithm-driven credit scoring and gamified investment platforms. These tools reshape decision-making environments by altering information flows, choice architecture, and the speed of transactions, often amplifying existing cognitive biases or creating new behavioral patterns. Understanding the interaction between human decision processes and digital interfaces is essential to designing interventions that improve financial outcomes.

This Special Issue invites original research and reviews exploring themes such as cognitive biases, heuristics, risk perception, emotional influences, and financial literacy, as well as the ways these factors operate in increasingly digital financial ecosystems. Submissions may address decision making across saving, spending, borrowing, investing, retirement planning, or responses to financial shocks, whether in traditional settings or technology-mediated contexts.

By deepening our understanding of behavioral drivers in finance, this Special Issue aims to inform more effective financial policy, product design, and education initiatives. We welcome diverse methodological approaches and interdisciplinary perspectives that contribute to a more nuanced understanding of financial decision making in practice.

Prof. Dr. Aaron Gilbert
Guest Editor

Manuscript Submission Information

Manuscripts should be submitted online at www.mdpi.com by registering and logging in to this website. Once you are registered, click here to go to the submission form. Manuscripts can be submitted until the deadline. All submissions that pass pre-check are peer-reviewed. Accepted papers will be published continuously in the journal (as soon as accepted) and will be listed together on the special issue website. Research articles, review articles as well as short communications are invited. For planned papers, a title and short abstract (about 250 words) can be sent to the Editorial Office for assessment.

Submitted manuscripts should not have been published previously, nor be under consideration for publication elsewhere (except conference proceedings papers). All manuscripts are thoroughly refereed through a single-anonymized peer-review process. A guide for authors and other relevant information for submission of manuscripts is available on the Instructions for Authors page. International Journal of Financial Studies is an international peer-reviewed open access monthly journal published by MDPI.

Please visit the Instructions for Authors page before submitting a manuscript. The Article Processing Charge (APC) for publication in this open access journal is 1800 CHF (Swiss Francs). Submitted papers should be well formatted and use good English. Authors may use MDPI's English editing service prior to publication or during author revisions.

Keywords

  • behavioral finance
  • financial decision making
  • cognitive biases
  • household finance
  • risk perception
  • financial literacy
  • heuristics
  • emotional influences
  • digital finance
  • financial behavior
  • behavioral economics

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Published Papers (6 papers)

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Research

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19 pages, 282 KB  
Article
Knowledge, Actionable Digital Skills, and Old-Age Anxiety: Evidence from Digital Financial Literacy Components Among Japanese Retail Investors
by Jargalmaa Amarsanaa, Honoka Nabeshima and Yoshihiko Kadoya
Int. J. Financ. Stud. 2026, 14(6), 139; https://doi.org/10.3390/ijfs14060139 - 1 Jun 2026
Viewed by 651
Abstract
Rapid digitalization has reshaped financial decision-making, and anxiety about later life is an important concern among middle-aged and older investors. Yet it remains unclear whether the traditional Big Three financial knowledge component captures the aspects of financial capability most closely associated with lower [...] Read more.
Rapid digitalization has reshaped financial decision-making, and anxiety about later life is an important concern among middle-aged and older investors. Yet it remains unclear whether the traditional Big Three financial knowledge component captures the aspects of financial capability most closely associated with lower anxiety in digital financial environments. This study examines the association between old-age anxiety and digital financial literacy (DFL) components among digitally active Japanese retail investors aged 40–64. Using data from a large-scale survey of 94,695 investors, we estimate ordered probit models to examine overall DFL and its eight subdimensions. While overall DFL is negatively associated with anxiety about life after age 65, decomposing the index reveals substantial heterogeneity across components. The traditional Big Three financial knowledge component does not show a robust independent negative association with old-age anxiety once actionable and protective digital competencies are accounted for. In contrast, practical know-how, positive financial attitude, and self-protection are more consistently associated with lower anxiety. Supplementary heterogeneity analyses suggest that the positive conditional association between financial knowledge and anxiety is most visible among men aged 50–59, although these subgroup patterns should be interpreted cautiously. These findings do not imply that financial knowledge is unimportant. Rather, they suggest that Big Three financial knowledge alone may be an insufficient proxy for the dimensions of financial capability associated with lower self-reported old-age anxiety in digital financial environments. Given the cross-sectional design, the findings are interpreted as conditional associations rather than causal effects. Full article
(This article belongs to the Special Issue Behavioral Insights into Financial Decision Making)
27 pages, 826 KB  
Article
Dynamics of Financial Decisions for 21st-Century Economic Environments: The Link Between Business Performance, Inclusion, and Financial Literacy of Entrepreneurs in Latin America
by Wladimir Chuquimia-Rivero, Elizabeth Emperatriz García-Salirrosas, Dany Yudet Millones-Liza and Miluska Villar-Guevara
Int. J. Financ. Stud. 2026, 14(5), 110; https://doi.org/10.3390/ijfs14050110 - 2 May 2026
Viewed by 1311
Abstract
Entrepreneurs represent a key piece in the generation of jobs and contribution to the economy through the performance of their businesses. Taking into account that literacy and financial inclusion constitute a business facilitator for the development of businesses, this study was based on [...] Read more.
Entrepreneurs represent a key piece in the generation of jobs and contribution to the economy through the performance of their businesses. Taking into account that literacy and financial inclusion constitute a business facilitator for the development of businesses, this study was based on analyzing the three variables, aiming to identify whether inclusion and financial literacy influence business performance. Through a non-experimental, quantitative study based on structural equations, a sample of 469 entrepreneurs from Peru, Bolivia, and Colombia was studied. The hypotheses were supported by observing the positive effect of one component of financial literacy (Cash Forecasting) and three components of financial inclusion (Access, Barriers, and Use) on Business Performance. However, the proposed model shows that the direct effect of two components (Bookkeeping and Financial Education) of financial literacy is not statistically significant. Therefore, these factors are vital tools that can help Latin American entrepreneurs make informed financial decisions, manage resources effectively, and build solid and sustainable businesses. Full article
(This article belongs to the Special Issue Behavioral Insights into Financial Decision Making)
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16 pages, 299 KB  
Article
Does Hyperbolic Discounting Mediate the Association Between Financial Literacy and Investment in Risky Assets?
by Mostafa Saidur Rahim Khan and Yoshihiko Kadoya
Int. J. Financ. Stud. 2026, 14(3), 72; https://doi.org/10.3390/ijfs14030072 - 12 Mar 2026
Viewed by 1285
Abstract
Investment in risky financial assets plays a crucial role in individual wealth accumulation and broader financial market development. However, existing research has primarily emphasized financial literacy while giving limited attention to behavioral mechanisms that may weaken its influence on investment behavior. In particular, [...] Read more.
Investment in risky financial assets plays a crucial role in individual wealth accumulation and broader financial market development. However, existing research has primarily emphasized financial literacy while giving limited attention to behavioral mechanisms that may weaken its influence on investment behavior. In particular, hyperbolic discounting, reflecting time-inconsistent preferences that favor immediate rewards over long-term gains, may constrain the effective translation of financial knowledge into forward-looking financial decisions. Against this background, this study examines whether hyperbolic discounting mediates the association between financial literacy and investment in risky assets using large-scale survey data from Japan’s Money and Life survey. Employing regression-based mediation analysis within a cross-sectional framework, the results indicate that financial literacy is strongly and positively associated with risky asset investment, while hyperbolic discounting exerts a statistically significant but economically small mediating effect that slightly attenuates this relationship. The findings suggest that cognitive financial capability remains the dominant driver of participation in risky financial markets, whereas present-biased preferences play a secondary behavioral role. These results provide important implications for investors, educators, and policymakers by highlighting that policies aimed at improving financial literacy are likely to yield substantial investment benefits, while complementary interventions addressing behavioral biases may offer additional, though more modest, gains in promoting long-term, forward-looking financial decision-making. Full article
(This article belongs to the Special Issue Behavioral Insights into Financial Decision Making)
10 pages, 240 KB  
Article
The Impact of Gender on Tax Compliance in Southern Albania
by Blerina Dervishaj and Melaize Gropa
Int. J. Financ. Stud. 2026, 14(2), 44; https://doi.org/10.3390/ijfs14020044 - 10 Feb 2026
Viewed by 1080
Abstract
We examine whether gender influences formal tax compliance among self-employed taxpayers in Southern Albania—focusing on two observable behaviors: paying taxes on time and the amount of unpaid tax debt (arrears). The study does not examine tax evasion or tax avoidance, as these behaviors [...] Read more.
We examine whether gender influences formal tax compliance among self-employed taxpayers in Southern Albania—focusing on two observable behaviors: paying taxes on time and the amount of unpaid tax debt (arrears). The study does not examine tax evasion or tax avoidance, as these behaviors cannot be directly observed in the available data. Using administrative data on 500 taxpayers in Fier, Vlorë, Berat, Gjirokastër, and Sarandë (January 2022–March 2025), we estimate the likelihood of timely payment with logistic and probit models and study unpaid liabilities using linear regression. Female-led businesses are more likely to meet deadlines and hold lower unpaid debts than male-led firms. These differences persist across sectors after controlling for firm size, region, income, and time. A negative and significant Gender × Sector term indicates that sectoral composition does not offset women’s compliance advantage in these formal outcomes. The effect size is relatively large for an environment with imperfect monitoring, suggesting that moral norms, reputational concerns, and perceived control weigh more heavily where deterrence is limited. From a policy perspective, adding gender to compliance-risk models and tailoring taxpayer services may indirectly improve voluntary payments and reduce arrears by refining compliance-risk assessment and targeting. To our knowledge, this is the first study in Albania using official administrative microdata to analyze gendered formal tax behavior, addressing a clear empirical gap in Southeastern Europe and providing evidence relevant for discussions of fair and inclusive fiscal policy in an EU-harmonization context. While the findings are derived from Southern Albania, they offer indicative insights for comparable transition economies in Southeastern Europe, rather than direct generalization. Full article
(This article belongs to the Special Issue Behavioral Insights into Financial Decision Making)
19 pages, 503 KB  
Article
Understanding Millennials’ Financial Behavior: The Role of Fintech Adoption, Financial Literacy, and the Mediating Effect of Financial Attitudes in a Crisis-Affected Emerging Economy
by Dani Aoun, Rita Rahal, Layal Sfeir and Nada Jabbour Al Maalouf
Int. J. Financ. Stud. 2026, 14(2), 35; https://doi.org/10.3390/ijfs14020035 - 4 Feb 2026
Cited by 6 | Viewed by 4511
Abstract
This study investigates how financial literacy, FinTech adoption, and financial attitudes shape economic decision-making among millennials in Lebanon, a crisis-affected emerging economy. The study examines whether enhancing financial literacy can strengthen economic resilience through improved financial behavior, with financial attitudes acting as a [...] Read more.
This study investigates how financial literacy, FinTech adoption, and financial attitudes shape economic decision-making among millennials in Lebanon, a crisis-affected emerging economy. The study examines whether enhancing financial literacy can strengthen economic resilience through improved financial behavior, with financial attitudes acting as a mediator. Guided by Behavioral Finance Theory, the study employs a quantitative approach using data from 390 Lebanese millennials collected via a structured questionnaire. Structural equation modeling was applied to test direct and mediating effects. Both financial literacy and FinTech adoption were found to significantly influence millennials’ financial behavior, with financial literacy emerging as the stronger predictor. The findings also revealed that financial attitude significantly mediates the link between literacy and behavior, suggesting that financial knowledge alone is insufficient without attitudinal reinforcement. This study fills a critical empirical gap in the MENA region by offering evidence from a highly under-researched, crisis-affected emerging market. It introduces an integrated model combining technological, cognitive, and attitudinal dimensions of financial behavior. The study offers practical implications for policymakers, financial institutions, and international development actors seeking to strengthen financial inclusion and household stability in similar turbulent contexts. Full article
(This article belongs to the Special Issue Behavioral Insights into Financial Decision Making)
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Review

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24 pages, 2699 KB  
Review
From Knowledge to Choice: How Financial Literacy Shapes Decision Making Through Behavioral Finance Mechanisms—A Systematic Bibliometric Study
by Antonija Mandić, Katerina Fotova Čiković and Tanja Jakšić
Int. J. Financ. Stud. 2026, 14(4), 79; https://doi.org/10.3390/ijfs14040079 - 1 Apr 2026
Cited by 2 | Viewed by 3001
Abstract
Despite extensive research on financial literacy and financial decision-making, the scholarly literature remains conceptually fragmented, particularly regarding how behavioral biases mediate or moderate the relationship between knowledge and financial behavior. The existing literature often focuses on financial literacy or behavioral biases in isolation, [...] Read more.
Despite extensive research on financial literacy and financial decision-making, the scholarly literature remains conceptually fragmented, particularly regarding how behavioral biases mediate or moderate the relationship between knowledge and financial behavior. The existing literature often focuses on financial literacy or behavioral biases in isolation, limiting a systematic understanding of their interaction. This study addresses this gap by conducting a bibliometric analysis of research at the intersection of financial literacy, behavioral finance, and decision-making. Following the Preferred Reporting Items for Systematic Reviews and Meta-Analyses (PRISMA) guidelines, we analyzed 267 peer-reviewed publications indexed in Web of Science and Scopus over the period 2010–2025 using the Bibliometrix 5.2.1 R package and VOSviewer 1.6.20 for co-occurrence, thematic clustering, and trend analysis. The results identify three interconnected research clusters: (i) socio-demographic and educational determinants of financial literacy, (ii) cognitive and behavioral biases influencing financial decision processes, and (iii) applied investment decision contexts. Overconfidence and herding dominate the literature, whereas biases such as framing, mental accounting, and intertemporal inconsistency remain comparatively underexplored. The analysis further reveals a post-2022 surge in publications, increasing internationalization, and emerging integration of digital finance and artificial intelligence themes. By systematically mapping the intellectual structure of this research domain, this study clarifies theoretical fragmentation, identifies under-researched behavioral mechanisms, and provides an evidence-based framework to guide future interdisciplinary and policy-relevant research on how financial literacy translates into financial behavior. Full article
(This article belongs to the Special Issue Behavioral Insights into Financial Decision Making)
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