Economics: Enhancing Financial Literacy in the Twenty-First Century

*Reprinted below from college assignment for EDI 468 – Teaching High School Social Studies Inclusively, Fall 2012


Economics: Enhancing Financial Literacy in the Twenty-First Century

Our tendency as social studies educators to approach economics according to its prescribed definition, “a social science concerned chiefly with description and analysis of the production, distribution, and consumption of goods and services,” fails to genuinely engage students in the rigorous practice of logically conceptualizing both the simplicities as well as the complexities of the day-to-day decision-making process that cumulatively generates our aggregated perspective of global economic affairs in the twenty-first century.[1]  In striving to instill the national, regional, and local principles of economics in our students, we must pursue an inclusive model both in the respect that our instruction is differentiated to empower the strengths and abilities of each individual student, but also in that it insists on making connections between course content and specific actions or events students will encounter in their future in a manner that is encompassed by the prior inserted classic definition.  This style provides a direct incentive for purposeful interaction with an organized curriculum by intrinsically motivating students through the use of empathic and insightful learning materials and allows for authentic instructional techniques to personalize students’ learning experiences according to specific goals, interests, and talents while referencing the traditional terms and concepts that constitute economic thought.

Pericles noted that, “just because you are not interested in politics, does not mean that politics is not interested in you.”  Similarly, and perhaps to a greater extent, too many students leave the comforts of high school without adequate knowledge of economics, remaining extraordinarily vulnerable to the financial challenges they will face in their futures.  According to the most recent assessment, Survey of the States 2011: The State of Economic and Personal Finance Education in our Nation’s Schools, “thirty percent of 18-24 year olds income goes towards debt repayment,” “seventy-five percent of credit card carrying college students were unaware of late payment charges,” and “in 2010, more individuals filed for bankruptcy than graduated from college.”  To combat these challenges, only fourteen states have mandated coursework in personal finance as a prerequisite to graduation and only twenty-two states require an economics course at all.[2]  To make matters worse, “fewer than twenty percent of teachers report feeling competent to teach personal finance topics.”[3]

So, to be sure, the first step in enhancing financial literacy is to actually teach it.  To that end, the Council for Economic Education has vigorously managed an “Advocacy Tool Kit” guide, complete with statistics from the 2011 Survey of the States report, national contact information to begin organizing campaigns, and a ten-step checklist to help teachers, parents, students, and community members propose increasing economics education in their districts.[4]  However, as we already know, in order to develop comprehensive understandings of economic decision-making, we must develop instructional techniques that engage students and inspire learning.  Too often, teaching activities focus on identifying key terms and concepts rather than applying specific principles within a framework that is meaningful to students.  Expecting students to seemingly memorize definitions is not only inauthentic and evidently difficult to comprehend but also embodies an extreme disservice to the students.  We must strive to apply such abstract concepts to real-world topics.

– – –

No economist has received as much attention in the past half-decade as Steven D. Levitt of the University of Chicago.  Levitt coauthored Freakonomics with journalist Stephen J. Dubner in 2005, “a book about cheating teachers, bizarre baby names, self-dealing Realtors, and crack-selling mama’s boys,” which made the New York Times best-seller list and was eventually translated into thirty-five languages and made over four million sales worldwide.  The sequel, Superfreakonomics, has also sold almost one million copies and a third edition is currently being written.  Additionally, a blog, radio show, and documentary have developed an ongoing engagement with readers.[5]

So why has Freakonomics been so successful?  How did Levitt and Dubner manage to write a bestselling book with Economics as the topic?  As Dubner wrote upon meeting Levitt in a New York Times Magazine article,

“As Levitt sees it, economics is a science with excellent tools for gaining answers but a serious shortage of interesting questions.  His particular gift is the ability to ask such questions.  For instance: If drug dealers make so much money, why do they still live with their mothers?  Which is more dangerous, a gun or a swimming pool?  What really caused crime rates to plunge during the past decade?  Do real-estate agents have their clients’ best interests at heart?  Why do black parents give their children names that may hurt their career prospects?  Is sumo wrestling corrupt?”[6]


Levitt’s work lies at the core of how we must teach economics in our classrooms.  Throughout the book he provides insights into professional terms and concepts as they’re applied to specific stories and topics he’s addressing.  Rather than explaining terms by supposing isolated examples he uses terms as an application to make sense of real-world examples, which is exactly what real economists do and is exactly what students must do in order to build financial literacy.  Levitt captivates his readership by addressing controversial topics, an essential aspect of any social studies lesson, within a page-turning narrative format.  Readers and learners remember Levitt’s arguments because he makes his writing memorable.[7]  The editors importantly note, “What unites all these stories is a belief that the modern world, despite a great deal of complexity and downright deceit, is not impenetrable, is not unknowable, and – if the right questions are asked – is even more intriguing than we think.  All it takes is a new way of looking.”[8]

Charles Wheelan, author of Naked Economics: Undressing the Dismal Science, approaches the topic similarly.  Wheelan captivates reader’s attention through the use of provocative subtitles to traditional chapter headings. For example, chapters titled, “Incentives Matter: Why you might be able to save your face by cutting off your nose (if you are a black rhinoceros),” “Government and the Economy II: The army was lucky to get that screwdriver for $500,” “The Federal Reserve: Why that dollar in your pocket is more than just a piece of paper,” and “Trade and Globalization: The good news about Asian sweatshops,” are just a selection of titles aimed at attracting readers attention.[9]  Wheelan implements economic concepts within contemporary real-world problems by shedding light on small sections of the social studies curriculum.[10]  Like Levitt, Wheelan confronts why Economics matters as an incentive to learn specific material rather than as an afterthought typically addressed only as a response to student complaints.  After captivating readers with relevant world events, learners are passionately engaged in discovering more about ‘the dismal science.’

When teaching economics, we cannot limit our students’ understandings merely to the exchange of goods and services, but instead follow the assertions of Wheelan and Levitt that economics is much more than that.  Indeed editors announce that,

Freakonomics establishes this unconventional premise: If morality represents how we would like the world to work, then economics represents how it actually does work.  It is true that readers of this book will be armed with enough riddles and stories to last a thousand cocktail parties.  But Freakonomics can provide more than that.  It will literally redefine the way we view the modern world.”[11]


That is the type of learning that motivates students.  It is the outlook we must subscribe to and embodies the method our instruction must follow.  So, how do we design such a curriculum?  What resources are available?  How ought we to inclusively engage students in the twenty-first century in learning principles of economics?

– – –

            The power of living in the Digital Age has truly not yet been discovered by the education enterprise.  With classrooms that are technologically connected to resources across the globe and teachers and students with the expertise to find them, the possibilities are virtually endless.  The place to begin for any economics educator is the website for the Council for Economic Education.[12]  In addition to providing the latest news, research, and professional development activities regarding economics education, the Council maintains a robust database of content material.  Interactive tools may be filtered by over one-hundred various concepts, targeted grade level, type of material (video, handout, quiz, PowerPoint presentation, etc.), or simply searched for via title.[13]  Furthermore, additional websites have been approved by the Council as excellent sources and have been sorted by topic for further use.  This not only provides additional sources to develop curriculum with, but also could serve as potential databases for student inquiry projects.[14]

Students demand interactive forms of learning.  Recent developments have created multiple platforms for hands-on learning, but perhaps none have been as successful as gaming.  The Council for Economic Education has designed Learning, Earning, and Investing, a “multi-faceted, comprehensive, investor education program for students in grades four through twelve” that includes lesson plans, online training on how to incorporate the material into the classroom curriculum, and a fifteen-mission online game for students to apply their knowledge.[15]  Students learn personal financial skills while competing against classmates on science-fictional missions.  Each mission takes less than thirty minutes to complete, making it ideal for either class time or a homework assignment.  More experienced students may be more interested in The Stock Market Game, developed by the SIFMA Foundation, which allows students to invest a fictional $100,000 in an online portfolio.[16]

Despite the remarkable transition to digital activities that enhance instruction, authentic hands-on trips remain invaluable experiences within a curriculum.  Visits to the local farmers market provide a wealth of material to teach students how economic principles affect their hometowns.  Preparing students for these experiences is essential to increasing comprehension, whether students are traveling just down the street or to national competitions such as the Personal Finance Challenge held annually by Wells Fargo or the National Economics Challenge (also held annually) across the country.[17]  Students even have the opportunity to contemplate global economic issues at weekly “summits” of the International Economic Summit program that travels regularly across the country.[18]  Although planning for national competitions requires adequate funding resources and inspired students who are up to the challenge, the benefits of participation far outweigh the costs.  Not only are informed students, “more likely to display positive financial behaviors and dispositions,” but also are, “more likely to save [money] and less likely to max out their credit cards… or be compulsive buyers.”[19]

It is evident that the state of economics education falls far below expectations.  With relatively few states genuinely striving to develop financial literacy skills, it is no wonder that so few students (or adults) truly grasp neither the simplicities nor complexities of how economic decision-making affects our day-to-day lives.  In improving comprehension of economics, educators must seek a variety of sources that integrate content material into meaningful, purposeful, and authentic exercises rather than simply expecting students to memorize specific concepts and ideas independent of one another and their connection to actual real-life applications.  This method presents an honest portrayal of the benefits of financial literacy and has the effect of intrinsically motivating students using potential rewards for learning.  Most importantly, it follows an inclusive model that caters to all students and expresses a complex subject using a memorable approach.


[1] For definition see: economics. Merriam-Webster. retrieved 10/24/12.

[2] To view the interactive report, see Full citation: Survey of the States 2011: The State of Economic and Personal Finance Education in our Nation’s Schools. Council for Economic Education. Funded by: The Calvin K. Kazanjian Economics Foundation. March 2012.

[3] Survey of the States 2011: The State of Economic and Personal Finance Education in our Nation’s Schools. Council for Economic Education. Funded by: The Calvin K. Kazanjian Economics Foundation. March 2012.

[4] “Advocacy Tool Kit”. Council for Economic Education. Retrieved 10/23/12.

[5] Bourree Lam, ed. “The Freakonomics Story”. retrieved 10/20/12.

[6] Stephen Dubner quoted in: Steven Levitt and Stephen Dubner. Freakonomics: A Rogue Economist Explores the Hidden Side of Everything. William Morrow: New York, 2005. p.x.

[7] For the importance of incorporating “conflict” into curricula, see James A. Percoco. Divided We Stand: Teaching About Conflict in U.S. History. Heinemann: Portsmouth, NH, 2001.

[8] Steven Levitt and Stephen Dubner. Freakonomics: A Rogue Economist Explores the Hidden Side of Everything. William Morrow: New York, 2005. p. inside front dust jacket.

[9] Charles Wheelan. Naked Economics: Undressing the Dismal Science. W.W. Norton & Co.: New York, 2010.

[10] Admittedly, I disagree with several ideological claims made in Naked Economics, but respect the reality that good teachers do not limit content based only on what they do and do not agree with politically.  Nevertheless the book does a fantastic job of explaining content in an exceptional format and my disagreements can be used for class discussions or counter arguments to help students develop additional perspectives and to provide an additional layer of “conflict” in the classroom.

[11] Steven Levitt and Stephen Dubner. Freakonomics: A Rogue Economist Explores the Hidden Side of Everything. William Morrow: New York, 2005. p. inside front dust jacket.

[12] Council for Economic Education. Retrieved 10/24/12.

[13] “Interactive Tools”. Council for Economic Education. Retrieved 10/24/12.

[14] “Web Links”. Council for Economic Education. Retrieved 10/24/12.

[15] “Gen iRevolution”. Council for Economic Education. Retrieved 10/24/12.

[16] “The Stock Market Game”. A Program of the SIFMA Foundation. Retrieved 10/25/12.

[17] See: “National Economics Challenge”. Council for Economic Education. Retrieved 10/26/12. and “National Personal Finance Challenge”. Missouri Council on Economic Education. Retrieved 10/26/12.

[18] “International Economics Summit”. Boise State University. Retrieved 10/26/12.

[19] Survey of the States 2011: The State of Economic and Personal Finance Education in our Nation’s Schools. Council for Economic Education. Funded by: The Calvin K. Kazanjian Economics Foundation. March 2012.


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