1,600 students who maintained satisfactory academic progress. Three years after the lotteries, winners were about 10 percentage points more likely to have finished 8th grade, and scored 0.2 standard deviations higher on achievement tests, although the latter result is only marginally significant. Barrera-Osorio and Linden (2009) study the introduction of computers to supplement learning in Colombian schools and find negligible improvements in language and math test scores and limited use of the computers for academic learning in higher grades despite the program’s focus to do so. Compared to these studies, our finding of an increase of 0.2-0.24 standard deviations in financial proficiency lies in the top end of statistically significant improvements in test scores.<sup>13</sup>

# **7.2. Purchasing and Spending Behavior**

Next we turn to analyzing changes in financial behavior. The student survey asked questions on outcomes related to topics emphasized in the financial education curriculum. Impulsive spending was an important behavior that the financial education program targeted. Consumers nowadays are exposed to a multitude of cleverly marketed consumer products, and falling prey to such temptation is particularly easy for young adults who are likely influenced by additional factors such as social norms, trends, and fashion. Furthermore, consumer items in Brazil such as cell phones are readily available to purchase on installment plans that come with large implicit (and often hidden) interest charges. A sizeable proportion of our student sample had part-time employment at baseline (35 percent) and an even greater proportion had disposable money available from other sources (67 percent), hence these temptations were real and meaningful. Against this setting, the financial education program highlighted the importance of responsible inter-temporal financial choices.

Our expected channel and direction of impact has precedent in the literature. Existing evidence from psychology supports a mechanism by which individuals can be taught to self-regulate better. The literature identifies self-control as being important in overriding temptation (Barkley, 1997; Baumeister et al., 1994), and how abiding and following learned rules can help individuals exhibit self-control and delay gratification (Hayes, 1989; Hayes et al., 1996). Repeated practice of such rules can further strengthen self-control mechanisms (Baumeister and Heatherton, 1996; Baumeister et al. 1998; Muraven and Baumeister, 2000; Baumeister et al. 2007). Some of the rules that were taught and repeated over a 17-month period in our course and measured in the follow-up surveys included saving up for purchases instead of buying items on installments, comparison shopping, negotiating prices, and keeping track of expenses by making budgets.

Table 5 shows treatment effects on these margins. We study saving for purchases on the extensive margin (whether you save for purchases?) in columns (1) and (2), and the intensive

> 13 There are also a number of papers that study classroom interventions in primary schools. These papers tend to find effects on test score between 0.15 and 0.47 standard deviations (for example, Banerjee et al., 2007; Cabezas et al., 2011; Muralidharan and Sundararaman, 2011; He et al. 2008; Linden, 2008).

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