TY  - JOUR
AU  - Choi, James J
AU  - Laibson, David
AU  - Madrian, Brigitte C
AU  - Metrick, Andrew
TI  - Defined Contribution Pensions: Plan Rules, Participant Decisions, and the Path of Least Resistance
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 8655
PY  - 2001
Y2  - December 2001
DO  - 10.3386/w8655
UR  - http://www.nber.org/papers/w8655
L1  - http://www.nber.org/papers/w8655.pdf
N1  - Author contact info:
James J. Choi
Yale School of Management
165 Whitney Avenue
P.O. Box 208200
New Haven, CT 06520-8200
E-Mail: james.choi@yale.edu

David Laibson
Department of Economics
Littauer M-12
Harvard University
Cambridge, MA 02138
Tel: 617/496-3402
Fax: 617/495-8570
E-Mail: dlaibson@gmail.com

Brigitte C. Madrian
730 B N. Eldon Tanner Building
Brigham Young University
Provo, UT 84602-3113
Tel: 801-422-4248
E-Mail: brigitte_madrian@byu.edu

Andrew Metrick
Yale School of Management
135 Prospect Street
P.O. Box 208200
New Haven, CT 06520
Tel: 203/432-3069
E-Mail: metrick@yale.edu
AB  - We assess the impact on savings behavior of several different 401(k) plan features, including automatic enrollment, automatic cash distributions, employer matching provisions, eligibility requirements, investment options, and financial education. We also present new survey evidence on individual savings adequacy. Many of our conclusions are based on an analysis of micro-level administrative data on the 401(k) savings behavior of employees in several large corporations that implemented changes in their 401(k) plan design. Our analysis identifies a key behavioral principle that should partially guide the design of 401(k) plans: employees often follow 'the path of least resistance.'  For better or for worse, plan administrators can manipulate the path of least resistance to powerfully influence the savings and investment choices of their employees.
ER  -