CHILDREN AND MONEY - GETTING AN ALLOWANCE, CREDIT VERSUS CASH, AND KNOWLEDGE OF PRICING

This study deals with children's behaviour concerning money. Children in three age groups (6, 8, and 10) were given four dollars either in cash or in the form of a credit card to spend in an experimental store. They were told that any money or credit they did not spend they would receive in cash to take home with them. The major finding was that those children who did not receive allowances at home spent more in the credit than in the cash condition, whereas those who got allowances spent the same amount whether they were given cash or a credit card. Neither the age of the children nor any other background variables affected the amount spent in the two conditions. However, girls spent more money than boys. We are inclined to attribute this effect to the differential attractiveness of the items to the two groups, but it may be a true sex difference. On a test of pricing knowledge, older children scored higher, as did those who got an allowance and those who were better at math, but these last two effects occurred mainly among the younger children. None of the other background variables was related to knowledge of prices. The pattern of results suggests that children who get allowances are more sophisticated about money than those who do not. © 1991.