Framing Effects and Expected Social Security Claiming Behavior
Eligible participants in the U.S. Social Security system may claim benefits anytime from age 62-70, with benefit levels actuarially adjusted based on the claiming age. This paper shows that individual intentions with regard to Social Security claiming ages are sensitive to how the early versus late claiming decision is framed. Using an experimental design, we find that the use of a "break-even analysis" has the very strong effect of encouraging individuals to claim early. We also show that individuals are more likely to report they will delay claiming when later claiming is framed as a gain, and when the information provides an anchoring point at older, rather than younger, ages. Moreover, females, individuals with credit card debt, and workers with lower expected benefits are more strongly influenced by framing. We conclude that some individuals may not make fully rational optimizing choices when it comes to choosing a claiming date.
|Date of creation:||May 2011|
|Date of revision:|
|Publication status:||published as Brown, J. R., Kapteyn, A. and Mitchell, O. S. (2013), FRAMING AND CLAIMING: HOW INFORMATION-FRAMING AFFECTS EXPECTED SOCIAL SECURITY CLAIMING BEHAVIOR. Journal of Risk and Insurance. doi: 10.1111/j.1539-6975.2013.12004.x|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
Web page: http://www.nber.org
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- H. Benitez-Silva & F. Heiland, 2008.
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- Jeffrey R. Brown & Jeffrey R. Kling & Sendhil Mullainathan & Marian V. Wrobel, 2008. "Why Don't People Insure Late Life Consumption: A Framing Explanation of the Under-Annuitization Puzzle," NBER Working Papers 13748, National Bureau of Economic Research, Inc.
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