Economics and BAFI Research Seminar

The Effect of Providing Peer Information on Retirement Savings Decisions

Please join the Economics and Banking and Finance Departments for a research seminar.  This event is open to all Case Western Reserve University faculty, Ph.D. students, economic majors and minors, and those interested in economics research.

Contact Teresa Kabat at teresa.kabat@case.edu or 216.368.4110 for additional information.

ABSTRACT: There is growing concern about households’ ability to make appropriate savings
decisions. Providing employees information about their coworkers’ savings behavior is one
natural way to offer guidance. We conducted a field experiment in a 401(k) plan to measure the
effect of such peer information on savings choices. Low-saving employees were sent a simplified plan enrollment or contribution increase form. A randomized subset of forms included information on the (high) fraction of coworkers either participating in or contributing at least 6% of pay to the plan. In contrast to prior literature, we document an oppositional reaction: peer information decreased the savings of non-participants who were not eligible for automatic
enrollment in the 401(k). Discouragement from upward social comparisons seems to play a role in the oppositional reaction. The presence of peer information did not on average significantly alter the savings decisions of recipients who had previously opted out of automatic 401(k) enrollment.

Friday, Nov. 15, 2013 from 10:30 a.m. to noon
Peter B. Lewis Building, Room 202
11119 Bellflower Road
Cleveland, OH 44106-7235
United States
Speaker(s): John Beshears, Ph.D., Stanford University
Sponsored by: Economics and BAFI Departments
The Effect of Providing Peer Information on Retirement Savings

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