How do 401(k)s Affect Saving? Evidence from Changes in 401(k) Eligibility

Alexander Gelber ()

MPRA Paper from University Library of Munich, Germany

Abstract: This paper investigates the effect of 401(k) eligibility on saving. To address the possibility that eligibility correlates across individuals with their unobserved tastes for saving, I examine a change in eligibility: some individuals are initially ineligible for their 401(k) but become eligible when they have worked at their firm long enough. I find that eligibility raises 401(k) balances, but I find no evidence that other financial assets decrease. I also find no evidence that intertemporal substitution drives increases in saving following eligibility. In response to eligibility, IRA assets increase, consistent with a “crowd-in” hypothesis, and accumulation of cars decreases.

Keywords: Savings; Retirement (search for similar items in EconPapers)
JEL-codes: H24 H31 (search for similar items in EconPapers)
Date: 2009-02-24
New Economics Papers: this item is included in nep-lab
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Citations: View citations in EconPapers (1)

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https://mpra.ub.uni-muenchen.de/13613/1/MPRA_paper_13613.pdf original version (application/pdf)
https://mpra.ub.uni-muenchen.de/27884/1/MPRA_paper_27884.pdf revised version (application/pdf)

Related works:
Journal Article: How Do 401(k)s Affect Saving? Evidence from Changes in 401(k) Eligibility (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:13613

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