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Title:Determinants of financial managers' perception of rural household economic well-being: An analysis of a composite measure
Author(s):Walson, Christopher Okey
Doctoral Committee Chair(s):Fitzsimmons, Vicki R.
Department / Program:Human and Community Development
Discipline:Human and Community Development
Degree Granting Institution:University of Illinois at Urbana-Champaign
Subject(s):Home Economics
Economics, General
Abstract:The objectives of this study were (a) to develop a composite measure of perceived economic well-being and (b) to determine the effects of socioeconomic and social-psychological variables on household financial manager's index of perceived economic well-being.
Data for this study were part of the NC-182 regional project "Family Resource Utilization as a Factor in Determining Economic Well-Being of Rural Families." The survey was developed by researchers from eight states: Arizona, California, Kansas, Illinois, Indiana, Iowa, Michigan, and Minnesota. A random sample of households was obtained from two counties in each of the eight states. Only those households in which the respondent was married were included in this study, resulting in 1772 households. The respondent was the financial manager of the household.
Utility theory provided the theoretical base on which hypotheses were developed. Socioeconomic and social-psychological variables associated with providing utility to the financial manager and/or empirically tested in a previous study were included in the model for this study.
For analysis purposes, the eight states were assigned randomly and equally to A-Half, analysis, and V-Half, validation, subsamples. Multiple regression analysis was used to determine the variables that influenced perceived economic well-being. Three stages of regressions were run: preliminary, combined, and final. The first two stages were run with the stepwise procedure, and the final stage was the regular regression.
A composite measure of the dependent variable, perceived economic well-being, was created using factor analysis. Seven variables were combined to create the index: (a) satisfaction with amount of money family is able to save, (b) satisfaction with amount of current debt, (c) satisfaction with current total household income, (d) satisfaction with level of consumption, (e) satisfaction with resources available to meet a financial emergency, (f) satisfaction with amount of household net worth, and (g) perceived income adequacy.
Eight variables were significant (p $\leq$.001) and explained.74 and.75 of variance in perceived economic well-being in the A-Half and V-Half subsamples, respectively. Only one, total household income, was a socioeconomic variable. The social-psychological variables were: (a) present financial condition compared to 5 years ago, (b) how often you save on regular basis for goal(s), (c) how often you make only minimum payments on charge accounts, (d) satisfaction with resources, (e) how often you worry about where money will come from to pay bills, (f) level of living, and (g) frequency of financial problems.
Issue Date:1991
Rights Information:Copyright 1991 Walson, Christopher Okey
Date Available in IDEALS:2011-05-07
Identifier in Online Catalog:AAI9211024
OCLC Identifier:(UMI)AAI9211024

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