Two essays on learning disabilities in the application of fundamental financial principles

Abstract

This dissertation consists of two essays which examine the relationship between dyslexia and the application and acquisition of financial knowledge. Recent behavioral research has documented that factors such as representativeness, overconfidence, loss aversion, naiveté, wealth, age and gender all impact a person’s risk perception and asset allocation decisions. Through the use of a simulated 401(k) asset allocation exercise, the first essay of this dissertation presents a preliminary case study which examines whether dyslexia, a specific learning disability which is neurobiological in origin, influences these critical investment decisions. The second essay explores the effectiveness of the use of color coding and a modified version of the Jalbret (2002) technique for teaching time value of money to dyslexic students.