Aaron Sojourner
Assistant Professor, Carlson School of Management, University of Minnesota
Assistant Professor, Carlson School of Management, University of Minnesota
Aaron Sojourner is an assistant professor at the University of Minnesota Carlson School of Management. He completed his PhD in economics at Northwestern University in 2009. He also has an MA in public policy analysis from the University of Chicago and a BA in history from Yale University. Research interests include the impacts of labor unions in the economic and political arenas, consumer financial decisions, and policies affecting human capital formation.
He serves on the steering committee member or the Human Capital Research Collaborative and a research affiliate at IZA. Complementing his research interest, Sojourner has a wide range of policy experience including past service as an adviser to the Office of the Illinois State Treasurer, member of several policy working groups, and as a fellow in the U.S. Senate’s Labor Policy Office.
Recent findings on limited financial literacy and exponential growth bias suggest saving decisions may not be optimal because such decisions require an accurate understanding of how current contributions can translate into income in retirement. This study uses a large-scale field experiment to measure how a low-cost, direct-mail intervention designed to inform subjects about this relationship affects their saving behavior. Using administrative data prior to and following the intervention, we measure its effect on participation and the level of contributions in retirement saving accounts. Those sent income projections along with enrollment information were more likely to change contribution levels and increase annual contributions relative to the control group. Among those who made a change in contribution, the increase in annual contributions was approximately $1,150. Results from a follow-up survey corroborate these findings and show heterogeneous effects of the intervention by rational and behavioral factors known to affect saving. Finally, we find evidence of behavioral influences on decision-making in that the assumptions used to generate the projections influence the saving response.