Understanding Financial Literacy in East Africa
Project Description
The internationally recognized TFL test, developed in the United States (Walstad & Rebeck, 2017), is a standardized instrument for measuring the financial knowledge and competence of high school graduates. Subsequently, validations and adaptations of the TFL have been con-ducted, including for Germany (Förster, Happ & Molerov, 2017) and Switzerland, resulting in the development of the TFL-G (Förster, Happ & Molerov, 2017).
To evaluate the effectiveness of financial education projects in Sub-Saharan Africa and beyond, it is important to assess participants' financial literacy levels before and after instruction and compare them with an untreated control group. While the TFL can serve this purpose, it was originally designed within a U.S. context. Just as the need for adaptation was established for Germany (Förster, Happ & Molerov, 2017), similar modifications appear necessary for the (East African) Tanzanian context, as Tanzania differs significantly from the United States in its socioeconomic conditions, societal structures, and access to formal education.
This research project therefore proposes the development of a TFL-TZ. Based on validation through field studies, it will outline the required adaptations, drawing from both the original TFL (USA) and the TFL-G (Germany). These adaptations are shaped by the general level of education, social structures, cultural norms, and other region-specific factors.
To evaluate the effectiveness of financial education projects in Sub-Saharan Africa and beyond, it is important to assess participants' financial literacy levels before and after instruction and compare them with an untreated control group. While the TFL can serve this purpose, it was originally designed within a U.S. context. Just as the need for adaptation was established for Germany (Förster, Happ & Molerov, 2017), similar modifications appear necessary for the (East African) Tanzanian context, as Tanzania differs significantly from the United States in its socioeconomic conditions, societal structures, and access to formal education.
This research project therefore proposes the development of a TFL-TZ. Based on validation through field studies, it will outline the required adaptations, drawing from both the original TFL (USA) and the TFL-G (Germany). These adaptations are shaped by the general level of education, social structures, cultural norms, and other region-specific factors.
Relevance to Liechtenstein
In recent years, Liechtenstein has intensified its role in development aid and international cooperation. Within this framework, the Principality has also supported Tanzania for several years, occasionally in response to specific events such as the severe floods of last year (Regierung des Fürstentums Liechtenstein, 2024). Other projects include the modernization of agricultural education to better address the challenges of climate change, with a particular focus on benefiting smallholder families (Regierung des Fürstentums Liechtenstein, 2023). The connection with Tanzania is so close that the then foreign minister personally visited the country in 2022 (Zeit Verlag Anstalt, 2022). Moreover, the Victoria School has been established for more than fifteen years as a privately initiated project by a Liechtensteiner in the city of Mwanza (Netzwerk für Entwicklungszusammenarbeit in Liechtenstein, n. d.). Although this research project will primarily be conducted in public schools, cooperation with this school may also be considered, provided the research design allows it and the school administration agrees. to ESG managers in the strategic planning of resource utilisation in the context of reporting.
Scientific, Economic and Societal Impact
The practical significance of the project is evident in the opportunities that an external evaluation could create for financial education initiatives, particularly in attracting additional funding to expand the program to more schools. From a research perspective, the relevance lies in assessing the applicability of the TFL test in the Tanzanian context. Furthermore, the study will evaluate the knowledge gains achieved through the existing financial education program.
