Wharton Pension Research Council Working Papers
 

Title

Fees, Framing, and Financial Literacy in the Choice of Pension Manager

Document Type

Working Paper

Date of this Version

10-1-2010

Abstract

A growing literature shows how consumers make mistakes in a variety of different settings pertinent to financial decision-making. Using data from a randomized experiment in Chile, we show how different ways of presenting pension management fees shape consumer choices, and how responses to pension fee information varies by level of financial literacy. Our results indicate that, in choosing pension funds, those with lower levels of education, income, and financial literacy rely more on employers, friends, and coworkers, than on fundamentals. We also find that such individuals are more responsive to information framing when interpreting the relative benefits of different investment choices.

Comments

The published version of this Working Paper may be found in the 2011 publication: Financial Literacy: Implications for Retirement Security and the Financial Marketplace.

Working Paper Number

WP2010-30

Copyright/Permission Statement

Opinions and conclusions are solely those of the author(s) and do not reflect views of the institutions supporting the research, with whom the authors are affiliated, or the Pension Research Council. Copyright 2010 © Pension Research Council of the Wharton School of the University of Pennsylvania. All rights reserved.

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Date Posted: 07 August 2019