Financial Knowledge and Career Aspirations Among the Young: A Route to Entrepreneurship

Abstract As research on the emergent phase of entrepreneurship remains limited, little is known about what influences entrepreneurial intentions. In this study, we empirically investigate whether financial knowledge enhances entrepreneurial aspirations focusing on young adults. To explore whether financial literacy plays a role in shaping career aspirations, we use data collected in 2023 by the Bank of Italy on a representative sample of individuals aged 18–34. Our results show a positive and significant relationship between financial knowledge and young individuals’ intention to become entrepreneurs. Our findings are confirmed using instrumental variable estimations, meaning that financial literacy increases entrepreneurial intentions. Moreover, we show that financial knowledge helps to reduce indecisiveness regarding future professional choices, making young people more focused on their aspirations. We also notice that the willingness to become an entrepreneur is lower among women, those holding a university degree, older adults, and those with lower risk tolerance.