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Extraneous menu-effects influence financial decisions made by pension trustees

Weiss-Cohen, L., Ayton, P. ORCID: 0000-0003-2285-4608 & Clacher, I. (2019). Extraneous menu-effects influence financial decisions made by pension trustees. Economics Letters, 108895. doi: 10.1016/j.econlet.2019.108895


Pension scheme trustees are responsible for the investment decisions of future generations’ retirement assets. However, behavioural finance research has mostly focussed on retail investors. While trustees are relatively sophisticated investors, they are not immune from biases. Across three experiments, we tested 252 pension scheme trustees for the influence of extraneous manipulations to the menu of options on investment decisions. Trustees were influenced by changes to the menu item mix, context, and layout. Care should therefore be taken when preparing information presented to trustees, in order to reduce biases that can be detrimental to pension outcomes.

Publication Type: Article
Additional Information: © 2019 Elsevier B. V. This manuscript version is made available under the CC-BY-NC-ND 4.0 license
Publisher Keywords: Pensions, Trustees, Menu-effects, Decision-making, Behavioural finance biases
Subjects: H Social Sciences > HG Finance
Departments: School of Health & Psychological Sciences > Psychology
Text - Accepted Version
Available under License Creative Commons Attribution Non-commercial No Derivatives.

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