Changcheng Song
Financial Illiteracy and Pension Contributions: A Field Experiment on Compound Interest in China
Singapore Management University
abstract conduct field experiment study relationship peoples misunderstanding compound interest pension contributions rural china find explaining concept compound interest subjects increased pension contributions roughly 40 treatment effect larger underestimate compound interest overestimate compound interest moreover financial education enables households partially correct misunderstanding compound interest structurally estimate level misunderstanding compound interest conduct counterfactual welfare analysis lifetime utility increases 10 subjects misunderstanding compound interest eliminated