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The Influences Of Locus Of Control, Debt, And Framing On Retirement Contributions, Bryan Foltice, Patrick Ilcin
The Influences Of Locus Of Control, Debt, And Framing On Retirement Contributions, Bryan Foltice, Patrick Ilcin
Scholarship and Professional Work - Business
This study evaluates locus of control, debt, and framing effects as potential drivers of retirement savings decisions. We administer an online survey analyzing how much an individual will save for retirement upon graduating college. The study finds that individuals with an external locus of control contribute significantly less to their retirement savings than individuals with an internal locus of control. Interestingly, this study finds no significant relationship between debt overhang and initial contributions. To measure framing effects, participants were given the choice to change their initial contribution rate after seeing the estimated increased future amount of their account balance based …
Misperception Of Exponential Growth: Are People Aware Of Their Errors?, Henning Cordes, Bryan Foltice, Thomas Langer
Misperception Of Exponential Growth: Are People Aware Of Their Errors?, Henning Cordes, Bryan Foltice, Thomas Langer
Scholarship and Professional Work - Business
Previous research shows that individuals make systematic errors when judging exponential growth, which has harmful effects for their financial well-being. This study analyzes in how far individuals are aware of their errors and how these errors are shaped by arithmetic and conceptual problems. While arithmetic problems could be overcome by employing computational assistance like a pocket calculator, this is not the case for conceptual problems, a term we use to subsume other error drivers like a general misunderstanding of exponential growth or overwhelming task complexity. In an incentivized experiment, we find that participants strongly overestimate the accuracy of their intuitive …