PhD Lunch Seminars Rotterdam

Speaker(s)
Meimei Dai (Erasmus University Rotterdam)
Date
Thursday, November 20, 2014
Location
Rotterdam

Owing to growing financial pressure on collective pension systems, individuals in many developed countries are confronted with more responsibilities in planning for their retirement. At the same time, information is not provided sufficiently and effectively at this moment, which calls for more focused and impactful communication. This paper will investigate what the key information is -from a normative perspective- that would be most valuable for individuals in pension planning. Information has value due to the gap in information between what consumers believe and what is objectively correct. In our analysis we apply life cycle model and define value of information as the added consumer welfare for individuals resulted from information provision. After calibrating parameters and solving the model, we are able to quantify values of various information and furthermore assign monetary values for each piece of information. The results have implications for policy makers, as they indicate which type of information has greater impact on individuals and can potentially improve consumer welfare the most.