Contributions to Defined Contribution Pension Plans

Posted: 11 Dec 2015

See all articles by James J. Choi

James J. Choi

Yale School of Management; National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Date Written: December 2015


Defined contribution (DC) pension plans are an increasingly important means of financing retirement consumption. Because individuals often have substantial discretion over how much is contributed to their DC pension plan, studying DC contribution choices provides general insights into the determinants of individual economic decision making. The literature has found strong deviations from many predictions of classical frictionless optimizing models. I provide an overview of the US DC pension system and review the literature on the effect of matching contributions, automatic enrollment, active choice deadlines, choice overload, financial literacy, peer effects, mental accounting, and personal experience on individuals' DC contributions.

Suggested Citation

Choi, James J., Contributions to Defined Contribution Pension Plans (December 2015). Annual Review of Financial Economics, Vol. 7, pp. 161-178, 2015. Available at SSRN: or

James J. Choi (Contact Author)

Yale School of Management ( email )

135 Prospect Street
P.O. Box 208200
New Haven, CT 06520-8200
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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