1

2 The Cost of Minimum Pension Guarantee

3 What is the problem we study? Governments often promise a minimum level of benefits under an accumulation scheme If future does not turn out to be rosy, what is the likelihood that the government has to foot the bill of this guarantee? Using the actual experience of the past eight years, and including actual features of the Mexican system, we calculate the probability distribution of such promises

4 Pension System in Mexico Investment Regime Minimum Pension Guarantee Model Results Conclusions

5 Current Mexican pension regime (for the formal sector) In 1997, Mexico moved from a defined benefits system (a la US Social Security) to a defined contribution system (a la Chile) The system is publicly mandated but funds are privately managed The funds are called AFORES (Administradoras de Fondos para el Retiro) There are three components to each fund: government component, private compulsory component and private voluntary component There is a government contribution There is also a government guarantee

6 Contribution is 6.5% of the base salary (SBC) There are three component Worker Employer  1.125% Monthly Contribution as percentage of SBC  5.150%  0.225% 6.5% Govt TOTAL Other Contributions  This is called Cuota Social (cs).  5.5% of minimum wage  indexed for inflation  Each individual can also make voluntary contribution to the system. But such funds are maintained separately Note: There is an upper limit to the SBC equivalent to 25 times the minimum wage

7 Pension System in Mexico Investment Regime Minimum Pension Guarantee Model Results Conclusions

8 Investment regime under the new system The AFORES invest in special funds called SIEFORES. Until 2004, the SIEFORES had extremely restricted investment regimes. For example, investment in anything other than high grade inflation protected bonds were not allowed In January 2005, new investments were allowed such as foreign bonds in currencies other than pesos as well as in other instruments provided that capital is protected from erosion (through synthetic instruments such as futures and options)

9 ACTUAL INVESTMENT STRUCTURE IN THE PENSION SYSTEM SIEFORE-1 SIEFORE-2 Allowed Financial Instruments & Limits Affiliated Workers  Debt Instruments with inflation protection – lower limit 51%  Foreign Debt – up to 20%  Assigned Workes  Workers over 56 years old  Workers who choose to invest under this SIEFORE  Foreign Instruments – up to 20%  Equity Notes – up to 15%  Workers under 56 years

10 Pension System in Mexico Investment Regime Minimum Pension Guarantee Model Results Conclusions

11 The nature of minimum pension guarantee The government promises to pay a minimum level of benefits if the amount of money accumulated in the worker’s account does not reach certain minimum value What does the government promise? The Federal Government promises the equivalent of one minimum wage to any worker who has contributed to the new system for 1250 weeks or 24 years (even if it is not continuous) The government promises to pay an annuity of one minimum salary for life for each worker in the system

12 Although small today, the number of people who become beneficiaries of this promise is rising Source: IMSS data Number of people entitled to minimum pension guarantee thousands,2005 Government burden of such a guarantee is rising... (millions of pesos) 4.3 4 3.5 2.8 2.2 1.7 1.3.9.19 86 66 49 35 25 17 8

13 1 to 3 MW 4 to 5 MW 6 to 10 MW More than 10 MW....and this will continue to rise because the workers under the regime largely have low wages (with over half earning no more than 3 times the minimum wage) M.W.= Minimum Waves Source: IMSS 55.68 % 20.65% 15.06 % 8.6% Salary level of workers under the IMSS system 2004

14 Pension System in Mexico Investment Regime Minimum Pension Guarantee Model to Calculate the Cost of the M.P.G. Results Conclusions

15 The model is as follows: The first element describes the distribution of the variable rate of return, the second describes the law of motion, the third is a contribution at each period taking into account the commission charged Equity Returns Accumulation Contribution

16 The rate of return is the actual rate that prevailed during 1997-2005 in Mexico   = 0.00757452 equivalent of 9.48% annual   = 7.12315% Adjusted Log Likelihood = 135.017 For the riskless rate, we took the real rate of return of Bondes182 (a government bond with inflation indexation) r f = 4.63% annual

17 We assume that a fraction  is invested in the broad stock index and the other fraction (1- ) is invested in government bonds Where: ComAFORE i,t Fee charged by AFORE i at time t cs Cuota Social Monthly rate of return of the Mexican broad market index IPC was indeed Normal during 1997-2005

18 Underlying assumptions for running simulations -Retirement Age. 65 years -Contribution period. 25 and 40 years respectively -Contribution Rate. 6.5% of base salary -Contribution frequency. Monthly -Commissions. We use the actual and projected commission structure taking into account the loyalty discounts offered by some AFORES -Inflation. We calculate everything in real terms

19 Measuring the guarantee cost We can conceptually think of the guarantee cost as an implicit put option for the government at the retirement age Where PMG:Price of a contingent annuity that pays the equivalent of one minimum salary in real terms V T :Funds accumulated in the worker’s individual account at retirement Payoff (T) = max{ PMG – V T, 0} PMG VTVT Payoff

20 We could value the option using traditional Black Scholes option pricing model (it requires risk neutral valuation and the assumption of complete contingent markets) Simulation Cashflows Average  1,000 realizations of the final amount for each level of salary assuming different levels of investment in equity  We calculate the present value for each trajectory  The average payment is the value of the option

21 We need to calculate the single premium contingent annuity of one minimum salary (the government guarantee) The net premium for such an annuity is calculated using the following euqation Where SM 97 :Minimum salary current in 1997 but brought forward to 2005 f :Administrative and acquisition fee 1% sm:Security Margin of 2% We also assume that at retirement the worker is married and his spouse is four years younger than him (average in Mexico) *We use the mortality table used by the Mexican Social Security

22 Pension System in Mexico Investment Regime Minimum Pension Guarantee Model to Calculate the Cost of the M.P.G. Results Conclusions

23 *Measured in multiples of minimum wage PROBABILITY TO EXERCISE THE GUARANTEE UNDER THE ASSUMPTION THAT THE WORKER CONTRIBUTES TO THE SYSTEM DURING 40 YEARS Probability Income* Equity Fraction MARKET Lambda Percentage Invested in Equity INCOME* 0%25%50%75%100% 1 1.0000.5490.2680.2240.231 2 1.0000.103 0.1150.142 3 00.0080.0240.0550.087 5 000.0050.0220.042 10 0000.0030.009 25 00000

24 WHEN WE REDUCE THE CONTRIBUTION TIME TO 25 YEARS, THE RESULTS CHANGE DRAMATICALLY MARKET Lambda Percentage Invested in Equity INCOME* 0%25%50%75%100% 1 1.000 0.9670.8290.728 2 1.000 0.8630.6800.603 3 1.000 0.6940.4990.443 5 1.0000.8930.3270.2840.297 10 000.0340.0580.099 25 0000.0010.006 Equity Fraction Income* Probability *Measured in multiples of minimum wage

25 Equity Fraction Income* Option Price We also calculate the cost of the option for the government MARKET Lambda Percentage Invested in Equity INCOME* 0%25%50%75%100% 1 216201158127116 2 1811611038581 3 147119635054 5 7842212432 10 00137 25 000. 073.256 Option price, 25 years thousands *Measured in multiples of minimum wage

26 LOS COSTOS DERIVADOS SON REDUCIDOS DE FORMA IMPORTANTE CON UNA MAYOR FLEXIBILIDAD DE INVERSIÓN EN EQUITIES Equity Fraction If the SIEFORES could invest up to 50% in Equity: $ 63,913 SIEFORE-2:$119,804 SIEFORE-1: $ 147, 491 53% Cost Reduction Guarantee Price for a worker who earns 3 M.W.

27 Pension System in Mexico Investment Regime Minimum Pension Guarantee Model to Calculate the Cost of the M.P.G. Results Conclusions

28 CONCLUSIONS  Minimum pension guarantee is present to serve a social purpose: protecting low income individuals from falling into poverty  But it also binds the government to future costs  High commission (between 20% and 30% of contribution) directly affect the minimum pension guarantee: therefore, governments should seriously consider strategies for reducing commissions  The capital protection regulation currently in place does not eliminate all downside risks  While allowing for investment in broad stock indexes can increase upside for the workers, it can significantly increase the burden for the government especially for low income workers

29 Income profile of AFORE affiliates who contribute regularly Tapen Sinha

30 How did income increase during 1997-2005 among affiliates? Main question Why is it important? To know how much affiliates would have in their AFOREs during their lifetimes To have an idea of how income changes in a life cycle context in Mexico in the formal sector To disentangle the gender gap in income

31 Limitations There are few observations in some of the cells – thus, they are not reliable (example: women in the highest quintile) We do not get a picture of all who are contributing – only the ones that are contributing regularly We only have data for 1997-2005 much less than lifetime data

32 Original study With macroeconomic data Modigliani Bloomberg life cycle hypothesis Milton Friedman permanent income hypothesis Both posit that people smooth consumption over lifetime income Income has less volatility than consumption

33 Income Consumption income consumption borrow?working liferetiredeath

34 “Typical” income consumption profile

35 Age consumption income profile in the US matches the typical one......

36 ....but the Japanese data does not match the typical...

37 Data For men and women separate samples For each quintile, 1000 persons for each age group 20 or below, 21-25, 26-30, 31-35, 36-40, 41-45, 46-50, 51-55, 56-60, 61 and above Total ten categories Thus, (in theory) we have 50,000 observations for men and women – we have less numbers Each person has a salary figure for August 1997 to February 2005 every two months (46 obs)

38 Simple analysis We can collapse all the observations by examining the average salary over (almost) eight years and examine how average salary changes with all the persons put together taking into account sex of the person and the age of the person This will be similar to the analysis of the US and Japan (we saw in the OECD Report in the previous slides)

39 Estimating for the entire sample Estimation Equation: Log(SalProm) = c 0 +c 1.sexo +c 2 edad +c 3 edad 2 LOG(SalProm) = 4.482169548 - 0.1617908224*SEXO + 0.0318998435*EDAD - 0.0003307339208*EDAD*EDAD Highly significant coefficients

40 Separate estimates Males SalProm = -9.935 + 9.311*EDAD - 0.0887*EDAD*EDAD Females SalProm = 18.471 + 6.712*EDAD - 0.06534*EDAD*EDAD

41 When does the income starts to decline From separate estimates: Male 52.47 Female 51.35 From combined estimate: Highest income at 48.23

42

43 What is wrong with the pictures? They are calculated from by combining all the people of different age groups They do not tell us anything about cohort effect Here, we can actually observe the real trajectory of persons over eight years What we need to know for constructing income profiles of actual workers is what they earn over their lifetimes – we have segments in our data

44 Household Savings and Income Distribution in Mexico Orazio P. Attanasio and Miguel Székely, 1998

45 Analyzing data controlling for cohorts and gender Now examine the data, controlling for "starting income" (which is a proxy for cohort) and follow them for eight years How should it look like? Logically, it should depend on the economic performance (more about that at the end) It should also depend on cohort For young higher growth than old

46 Time Wage Young Old Observations from data….that leads to…. 19972005

47 20s30s40s50s60s Wage …the following lifetime wage profile

48 Males in Quintile 1 Each point is average

49 Males in Quintile 2

50 Males in Quintile 3

51 Males in Quintile 4

52 Males in Quintile 5

53 Time Wage rate Stylized Fact Men in 20s Men in 30s Men in 40s Men in 50s

54 Females in Quintile 1

55 Females in Quintile 2

56 Females in Quintile 3

57 Females in Quintile 4

58 Females in Quintile 5

59

60 Stylized facts For the three middle quintiles, all income of all ages grow Men's income always stays above that of women's For men and women in their twenties, the income grows faster than for men in their forties, fifties and sixties Wage gap between men and women is expanding for women in their twenties but not for them in their sixties (see the following slide)

61 We ignore this segment Too few data points

62 For the men in their twenties in the third quintile

63 For the men in their fifties in the third quintile

64 Applying the naïve model

65 Econometric issues Wage rate series for almost all age groups for almost all income quintiles have unit roots Thus, simple correlations among level series give spurious correlations How do we deal with the problem? One solution: Instead of the original series, manage the growth rate of the series

66

67

68 Result Even though the original series look quite dispersed, the growth rate (log difference) are almost perfectly synchronized What would they be related to? One possible culprit: the monthly GDP Index produced by INEGI (actual GDP figures are only available every three months, our series is available every two)

69

70 A simple model

71 But the model is wrong Why? Using Augmented Dickey Fuller test we cannot reject the hypothesis that M30 and GDP Index have unit roots Next logical pass: cointegrated model

72 Cointegration test results We reject the null hypothesis that there is no unit root: one unit root

73 What comes first? Change in GDP or Wage rise?

74 Lump sum –Usually there are many restrictions –Justified to prevent "double dipping" Phased withdrawal (also called programmed withdrawal) –Problem of adverse selection Annuities –Individual or joint –Criticism against individual annuities Options for Retirement Benefits

75 Country Payout Market Structure Lump-sums Allowed? Degree of Annuitization Degree of PWs AustraliaCompetitiveYesVery LowLow ChileCompetitiveYes, but restricted > 60% < 40% DenmarkCompetitiveYes, but restricted> 50%< 50% SwedenMonopolyNo100%0% SwitzerlandCompetitiveYes, but restrictedVery high0% ColombiaCompetitiveYes, but restricted HungaryCompetitiveNoStarts in 2013 PolandCompetitiveNoStarts in 2009 Source: Rocha, IIFA, Istambul, 2006 Types of Payout

76 In Chile (best case scenario) YearProgrammed Withdrawal AnnuitiesInsurance 198832.20%10.00%57.80% 199042.10%23.30%34.40% 199546.00%39.60%11.20% 200040.60%52.20%5.30% 200537.30%58.60%2.80% 200638.30%57.90%2.60% Source: SAFP, 2007

77 Where is the meat of contribution? 6.5% of base wage (upto a limit) for retirement 5% on housing account 2.5% on life and disability Workers compensation All the money in bold red are managed by the ubiquitous IMSS and in blue by INFONAVIT What happens in Mexico?....and why should the rest of the world care?

78 SAR-97 reform treats differently members of the “transition cohort” from members of the “new cohort.” If a new entrant to the labor force after July 1997 ( “new cohort”) becomes disabled or dies, she or her beneficiaries must buy an annuity from a private insurance sector specialized annuity provider.Rules

79 Where is the meat? WorkersNumberDistribution Transitional generation 7,743,05763 percent New generation 4,604,99337 percent Total12,348,050100 percent Source: IMSS, data for 2004

80 Source: CNSF, 2008

81

82 The 1997 LGISMS reform stated that insurance companies licensed to practice life insurance were allowed to offer pension annuities for a five years transition period. After that period, those insurance companies would have had to separate annuities operations in specialized pension annuity companies. This explains the transition Why all specialized companies now?

83 Source: CNSF, 2008, vertical axis in percent Bancomer 32.8% Porvenir GNP 18.3% Génesis 14.7% Inbursa 13.3% Comercial América 6.2% BBVA Bancomer23.0% Pensiones Inbursa 15.8% Profuturo GNP15.5% Pensiones Banorte 10.9% Pensiones Banamex 10.6%

84 Foreign subsidiaries have come to dominate –This is a general pattern due to NAFTA Number of companies have shrunk somewhat – dominated by specialized companies –This is due to laws related to who can sell Concentration in the industry has stayed the same since 1999 Summary of what has happened (the tip of the iceberg)

85 Performance of annuity market LR = the loss ratio; OR the operational expense ratio; UR = the underwriting expense ratio Source: CNSF

86 Source: CNSF, 2007 The Iceberg: Pension becomes a significant player but then it shrinks

87 A closer look: A clear drop from the peak in 2001

88 When the new regulatory regime came into effect in Mexico, the initial plan of 1995 called for buying single premium annuities for the widows and disabled workers under the new system. Given that all these affiliates under the new regime would not have enough money in their accounts, the government (through the IMSS) would pay a lump- sum to pay for such annuities Specialized companies would enter this market The Initial Plan

89 Additional benefits offered by private companies CompanyAdditional Benefits % Allianz14.5 Inbursa12.0 Comercial América8.0 BBV7.3 Banamex7.0 GNP7.0 Bital7.0 Banorte6.5 Génesis6.3 Bancomer3.7 Source: Own, data from 2000

90 Before 1997, during the defined benefit regime, beneficiaries were paid annually and no annuity was bought Under the new regime, IMSS observed two facts between 1997-2000 –First, cash outflow rose dramatically to pay for the disabled workers and the widows –Second, more than a third of the disabled workers died within three years What happened during 1997-2000

91 It depended on the size of the annuity On the average, the cost was between 800,000 and 900,000 pesos per case With over 30,000 cases in 2001, it put severe pressure on the budget of the IMSS (which still had a pay as you go structure – the current expenditure came from current year's budget of the federal government) How much did it cost per annuitant to IMSS?

92 A study by IMSS showed that the minimum pension guarantee is a little less than USD 200 per month This pension is 10% more than what people got under the old law The lump sum required for a worker receiving a minimum pension is of a little less than a USD 100,000. Summary of additional outflow of IMSS due to annuities

93 Comparative benefits under 1973 versus 1997 regimes Source: Fernandez Reyes (2004)

94 In order to lower the costs, IMSS adopted a new policy: All disability pensions were going to be treated as provisional pensions This would avoid the lump sum payment of buying a single premium annuity for at least two years Why two years? How much did the cost rise for IMSS

95 By law, all temporary pensions must be renewed as temporary or changed to definitive pension within two years After this two year period rule during 2001-2003, outflow due to single premium annuity were dramatically reduced Most of the pensions granted were "renewed" temporarily instead of reassigned as "definitive" Why two years?

96 Mexican law establishes that a disability pension must be granted whenever a person is unable to fulfill the exact same job they were doing before the disease or accident The IMSS established more stringent medical criteria before granting a permanent disability pension Essentially, a person had to prove to be VERY sick in order to get it. This ruling became know as the Last Temptation of the IMSS

97 In Mexico, proving one's identity can be difficult For tax and social seucurity purposes –First, the names have to match exactly –Second, the identity by RFC have to be right –Third, new identity by CURP have to be right Many people get multiple Ids It affects them severely when they try to collect their social security benefits Common problems got compounded with tighetened requirements

98 The IMSS did an internal study It projected forward the cost had the lump sum payment to buy annuities continued (called the "benchmark") It projected forward the cost with the new policy of payment with the tightened policy The comparison is shown in the next slide Does the IMSS REALLY reduce the cost in the long run?

99 IMSS study of cost comparison

100 The big spike in the cost of year 2006 from the benchmark comes from assuming the costs of all the lump sums generated by the pensions that were handled as temporary but were supposed to be definitive. The current policy is cheaper until the year 2053 Which one is cheaper? We have to choose a discount rate to make a comparison of the two vectors by converting them into scalars Some observations of the cost projection 2005-2068

101 Comparison of the regimes

102 New policy has reduced the “cost to IMSS” in the NPV sense in the order of $20 billion pesos (at a benchmark rate of 3.5%) However, such a reduction in cost has a price in the future The market for contingent annuities has collapsed This reduction in competition could increase the transactions cost of buying annuities in the future thus compensating for the saving that IMSS has generatedConclusions

103 Institutional structures are important –It is possible that loopholes in reform can allow the (bad?) old regime to play havoc in the annuities markets Strict regulation does not necessarily benefit annuitants –Mexican companies offering annuities have heavy restrictions on investment regime –A quick change in market condition can actually make matters worse – it also discourages new entrants So what? General lessons

104 Cultura Financiera, Información y Elasticidad de la Demanda: El estudio y la Evidencia Experimental de México

105 Introducción Una mayor capacidad de elección La privatización en tradicionales mercados de bienes y productos La elección permite a la gente usar la información privada La elección crea incentivos para la eficiencia Ejemplos La elección escolar El cuidado de la salud La seguridad social

106 Introducción En todos los mercados, la eficiencia y los resultados dependen del comportamiento del consumidor Altos costos de la toma de decisiones podría colocar a los consumidores en posición para determinar las características, como la marca, utilidad y publicidad más que el precio

107 Conclusiones La competencia no conduce a la eficiencia Hace más grande la brecha del estatus socioeconómico Las empresas podrían no tener incentivos para proporcionar información eficiente

108 Problemas de Cultura Financiera (1) Suponga que tiene $100 en una cuenta bancaria y el tipo de interés que otorga es del 2% por año. Después de 5 años, ¿cuánto cree que habrá en la cuenta: más de $ 102, exactamente $ 102, menos de $ 102? (2) Imagine que la tasa de interés en la cuenta de ahorro fue de 1% y la de inflación de 2% por año. Después de 1 año, ¿sería capaz de comprar más, exactamente lo mismo o menos de lo que hoy puede comprar con el dinero de la cuenta?

109 Problemas de Cultura Financiera (3) Si 5 personas tuvieran el número ganador de la lotería y el premio fuera de 2 millones de dólares, ¿cuánto le tocaría a cada uno? En EUA, menos del 50% de las personas podrían contestar (1), (2) y (3) correctamente Un estudio similar está haciéndose en México y Chile

110 Estudios Los trabajadores son inelásticos al precio Altos costos de cambio Cambios en el trabajo implican cambios en su duración Efectos importantes cuando se trabaja en equipo con los patrones

111 Estudios Los trabajadores responden a la publicidad en lugar del “precio” Los consumidores NO tienen visión futura Son demasiado sensibles a la información irrelevante Comportamiento diferente en los trabajadores con salarios altos

112 Estudios Hastings y Mitchell examinan los vínculos entre la actual tendencia, la cultura y decisiones financieras en los ahorros y pensiones en Chile. Experimento de campo y uso de datos de encuestas de hogares Implicaciones para el diseño de políticas

113 Este estudio Se discuten los resultados de la encuesta piloto en la ciudad de México Este proyecto recoge los datos de la encuesta de una muestra para examinar ¿Cómo se mide el impacto de la cultura financiera en la sensibilidad al precio? ¿Pueden los políticos usar la información y enmarcar dichas desviaciones causadas por el “analfabetismo” financiero?

114 Cambio de México Objetivos: Reducir la desigualdad presente del sistema anterior, aumentar la cobertura y el monto de las pensiones, hacer del sistema de pensiones financieramente viable El sistema toma lugar entre 2005 y 2008

115 Hasta 2008 Los trabajadores deben elegir el fondo en el momento de entrar al mercado laboral formal El trabajador puede cambiar con bastante facilidad los fondos: Llamar a CONSAR En línea Llamar a las Afores

116 Tasas Las AFOREs cobraban una tasa sobre flujo y/o una tasa de equilibrio Comisiones variables está calculado como un porcentaje del salario Comisiones variables de 1% = 15.4% del salario (1/6.5 = 0.154). El balance de los comisiones son calculados como un porcentaje de los activos manejados

117 Tasas CONSAR publica un “Balance de comisiones equivalentes anuales” (CEF) El balance de comisiones de una Afore podría contener un cargo para hacer el mismo efecto al final de un año que si no carga comisiónes variables Hipótesis que deben ser formuladas: El balance está establecido con relación al salario del sistema, el cual sobreestima el pago de comisiones,pero hace que el CEF se vea mas en el rango de una comisión de manejo razonablemente alta

118 Tasas Con el fin de cambiar o elegir una Afore, los trabajadores deben firmar un documento constando que ellos han visto y entendido la tabla equivalente de últimos tres años de las comisiones equivalentes.

119 Cuestionario Serie de preguntas sobre el conocimiento del sistema, la elección de comportamiento, la cultura financiera Seguido por las opciones hipotéticas Comisiones anuales solamente Comisiones sólo en pesos por año Comisiones sólo en pesos por 10 años Comisiones y tasas de retorno por un año Comisiones y tasas de retorno por 1 y 3 años Cada trabajador es seleccionado aleatoriamente para obtener 4 de estos cálculos de balance

120 Cuestionario Identificación Precios (rendimientos) y nombres de empresas a través de encuestas al azar y dentro de la encuesta Preguntan por las 3 primeras empresas clasificados

121 Cuestionario Universidad de Yale: Encuesta sobre el Ahorro para el Retiro Estamos realizando una encuesta para entender mejor la perspectiva de los trabajadores Mexicanos sobre el ahorro para retiro. Sus respuestas de esta encuesta serán completamente confidenciales y usaremos solamente con fines de análisis e investigación en nuestra universidad.

122 Cuestionario La encuesta le quitará aproximadamente 10 minutos de su tiempo. Por favor lea instrucciones para cada pregunta y señale su respuesta. Nos interesa su opinión, y para ello, no hay respuestas correctas o incorrectas.

123 Cuestionario Ahora, nos gustaría pedirle que elija una AFORE en base a la información presentada. Suponga que su hermano favorito, José, está considerando cuál AFORE elegir. José tiene 40 años de edad, gana $3,300 pesos al mes, y actualmente tiene una cuenta de ahorro para el retiro con un saldo de $17,500 pesos. José le ha pedido su consejo sobre cuál AFORE debería de elegir.

124 Cuestionario Suponga que usted sabe que las AFORES cobran una comisión anual, y la CONSAR le ha facilitado una tabla que indica la comisión anual que cada AFORE le cobraría a su hermano José.

125 Cuestionario De acuerdo a su actual conocimiento sobre las AFORES y a la siguiente tabla, que le ha sido facilitada por la CONSAR, indique las TRES MEJORES AFORES que le recomendaría elegir a su hermano José. En la casilla en blanco a la izquierda del nombre de la AFORE, escriba el número 1 para la mejor opción, el número 2 para la segunda mejor opción, y el número 3 para la tercera mejor opción.

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138 Conclusión Información simplificada tiene un impacto causal en la elección del comportamiento de los “analfabetos” financieros Revisando las comisiones y retornos reduce la elasticidad del precio de la demanada Los “analfabetos” financieros son un gran segmento del mercado, y el cambio en su comportamiento puede tener grandes efectos sobre las tasas Observando la elección y demanada se puede entender los incentivos de las firmas para diseñar políticas que minimícen las distorciones en mercados privados para bienes públicos