Information Framing and Retirement Management Decisions: Evidence from a Field Experiment in Mexico

Abstract

I analyze whether information framing related to the performance of Pension Funds Administrators affects the retirement management decisions of Mexican workers. I conduct a survey to collect information on recommendations for Fund Administrator made by Mexican workers when faced with randomly framed scenarios. The scenarios feature framing based on choice avoidance and framing exploiting loss aversion. I find evidence that reducing the number of possible choices increases the probability that individuals choose a Fund Administrator with a higher net return or with lower fees. A "loss aversion" framing increases the probability that individuals choose a Fund Administrator with a higher net return. Finally, I find evidence that higher levels of financial literacy decrease the effects of framing on Fund Administrator choice.

Keywords: Framing, Mexico, Retirement

JEL Classification: J26, C93