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Revealed and Concealed Preferences in the Chilean Pension System: An Experimental Investigation

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  • Abigail Barr
  • Truman Packard

Abstract

Using survey data and a field experiment to measure agents` risk and time preferences, we identify the agent-type that is free to reveal its preferences through decisions about pension system participation. Thus, we show that in Chile the appropriate focus for policy makers interested in the welfare-enhancing effects of such participation are the self employed. They are indistinguishable from other economically active agents with respect to time and risk preferences and sort into participants and non-participants in the pension system with reference to those preferences. In contrast, employees are rationed. The more patient and less risk averse self employed participate.

Suggested Citation

  • Abigail Barr & Truman Packard, 2000. "Revealed and Concealed Preferences in the Chilean Pension System: An Experimental Investigation," Economics Series Working Papers 53, University of Oxford, Department of Economics.
    • Handle: RePEc:oxf:wpaper:53
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    References listed on IDEAS

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    1. Samwick, Andrew A., 1998. "Discount rate heterogeneity and social security reform," Journal of Development Economics, Elsevier, vol. 57(1), pages 117-146, October.
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    3. Taylor, Mark P, 1996. "Earnings, Independence or Unemployment: Why Become Self-Employed?," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 58(2), pages 253-266, May.
    4. Harris, John R & Todaro, Michael P, 1970. "Migration, Unemployment & Development: A Two-Sector Analysis," American Economic Review, American Economic Association, vol. 60(1), pages 126-142, March.
    5. Yamada, Gustavo, 1996. "Urban Informal Employment and Self-Employment in Developing Countries: Theory and Evidence," Economic Development and Cultural Change, University of Chicago Press, vol. 44(2), pages 289-314, January.
    6. Renate Schubert, 1999. "Financial Decision-Making: Are Women Really More Risk-Averse?," American Economic Review, American Economic Association, vol. 89(2), pages 381-385, May.
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    Cited by:

    1. Yann Girard & Florian Hett, 2013. "Competitiveness in dynamic group contests: Evidence from combined field and lab data," Working Papers 1303, Gutenberg School of Management and Economics, Johannes Gutenberg-Universität Mainz, revised 01 Apr 2013.
    2. Juan Camilo Cardenas & Jeffrey P. Carpenter, 2005. "Experiments and Economic Development: Lessons from Field Labs in the Developing World," Middlebury College Working Paper Series 0505, Middlebury College, Department of Economics.
    3. Juan Camilo Cardenas & Jeffrey Carpenter, 2008. "Behavioural Development Economics: Lessons from Field Labs in the Developing World," Journal of Development Studies, Taylor & Francis Journals, vol. 44(3), pages 311-338.
    4. Maarten Voors & Eleonora Nillesen & Philip Verwimp & Erwin Bulte & Robert Lensink & Daan van Soest, 2010. "Does Conflict affect Preferences? Results from Field Experiments in Burundi," HiCN Working Papers 71, Households in Conflict Network.
    5. Maloney, William F., 2004. "Informality Revisited," World Development, Elsevier, vol. 32(7), pages 1159-1178, July.

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    More about this item

    Keywords

    field experiment; time preference; risk aversion; pension reform; self employment;
    All these keywords.

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand

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