Development of intuition in a new currency, the Euro: The Slovak experience

Abstract

Adaptation to an unfamiliar currency is required regularly of international travellers – and also of citizens of countries changing their currency, such as the 19 (to date) Eurozone members. We report on the currency adaptation process in the Slovak Republic during 2008-2011. We analyse its effects on citizens’ development of price intuition in the euro. Our study draws on Hofmann et al.’s (2007) work, which proposed four different strategies for coping, ranging from direct numerical conversion to developing intuition. We conducted repeated cross-sectional surveys using structured questionnaires in realistic Slovak settings. We describe European and Slovak institutions’ supports for the public, such as dual display of prices, and readily available conversion tables. We found that, whereas the numerical conversion strategy was used most frequently by respondents in the first year, within two years they were already developing intuition in the new currency, especially for frequently bought products. We also investigated the ‘Euro Illusion’, the extent to which Slovak citizens, in their evaluation of prices, may have been influenced to make decisions based on nominal values, whereby prices in euros seemed smaller than those in Slovak crowns. We summarise suggestions for promoting learning in situations of currency change, and briefly discuss the features of the Slovak process as a ‘numerate environment’. KeywordsPrice intuition; numeracy; learning; intuition strategy; marker value strategy; anchor strategy; numerical conversion strategy.