Cutting edge research on consumer financial decision making by scholars across diverse fields: economics, psychology, sociology, anthropology, marketing, finance, and consumer sciences. Lively discussion of this research by scholars, regulators, consumer advocates, and financial services professionals.
Please save the dates for the Boulder Summer Conference on Consumer Financial Decision Making. The conference will be held at the St Julien Hotel at a great time of year to visit Boulder, Colorado.
The conference will provide an opportunity for exchange of ideas among researchers in different fields working on problems of consumer financial decision-making.
Consumer welfare is strongly affected by household financial decisions large and small: choosing mortgages; saving to fund college education or retirement; using credit cards to fund current consumption; choosing how to “decumulate” savings in retirement; deciding how to pay for health care and insurance; and investing in the stock market. In all of these domains, consumers are often poorly informed and susceptible to making serious errors that have large personal and societal consequences.
Basic research in judgment and decision making, psychology, consumer research, behavioral finance, and behavioral economics can inform our understanding of how consumers actually make such decisions and how consumers can be helped to make better decisions by innovations in public policy, business, and consumer education.
The conference is co-sponsored by the Center for Research on Consumer Financial Decision Making at the University of Colorado and by the Leeds School of Business.
Conference Format
We begin with a keynote address and panel discussion Sunday late afternoon, followed by a reception and poster session. Monday and Tuesday we will have 10 total plenary sessions of 75 minutes each, each with two related papers, a discussant, and plenty of time for audience questions and comments.
Submit Paper Abstract
Abstract Submission Deadline
Deadline for extended abstract submissions: December 15, 2012.
The conference co-chairs will select papers for presentation at the conference based on extended abstracts (one page, single spaced). Selected papers must not be published prior to the conference, but those researchers presenting their work at the conference must commit to have a paper that is complete and available for review by discussants one month prior to the conference.
Selections will be based on quality, relevance to consumers' financial decision-making, and contribution to breadth of topics and disciplinary approaches. We consider not just the individual merits of the papers, but how they pair with another submission from a scholar in a different field. The organizers will invite authors of the best papers not selected for presentation at a plenary session to present their work at the Sunday evening poster session.
Complete papers to be presented at the conference should be provided to the conference co-chairs and discussants one month in advance of the conference.
Early behavioral finance work produced large benefits in social welfare by encouraging 401-K retirement savings. But opportunities exist for firms and regulators to work with academics and each other to solve important social problems, such as employees prematurely withdrawing greater amounts from their retirement than employers contribute each year.
First time homebuyers who underestimate their non-mortgage debt borrow more, controlling for borrower characteristics and, ironically, those who underestimate their non-mortgage debt are more likely to seek financial counseling.
Upon entering their first mortgage, individuals making the transition into homeownership often exhibit dramatic increases in overall debt and delinquency.
In determining likelihood of default on student loans, process variables—such as financial guidance from parents, financial management practices, and perceived return on education—were more predictive than traditionally scrutinized academic success variables.
Financial debt contracts are often resold to third parties in financial markets, but this research indicates that borrowers feel less obligation to repay a third party than the original lender.
Mandatory mediation requirements prove effective in persuading delinquent mortgage borrowers to talk to lenders, producing better outcomes for both borrowers and lenders.
Attorney Perceptions of Influence on Bankruptcy Chapter Choice
In general, debtors can achieve better outcomes if they select Chapter 7 bankruptcy rather than Chapter 13. However, attorneys disproportionately recommend Chapter 13 to African American debtors and are unaware of the racial bias in their recommendations.
The Effects of CARD Act Disclosures on Consumer Use of Credit Cards
A study of the effect of the Credit Card Accountability, Responsibility and Disclosure (CARD) Act on consumer credit behaviors indicated that the Act had only a small positive impact on consumers’ credit card payment decisions.
The CARD act required a warning to encourage lower debt by showing the amount of payment needed to pay off a debt in three years, but empirical evidence suggests that these warnings do not work as intended. Other information about effects of paying more would produce better choices.
Can Consumers Make Affordable Care Affordable? The Value of Choice Architecture
Consumers seem unable to make cost-effective health insurance choices in the insurance markets (termed exchanges) that will be established by the Affordable Care Act. However, with appropriate choice architecture, consumers choose cost-effective plans.
From Intuition to Insolvency: Decision Making Style in Adolescence Predicts Financial Well-Being in Adulthood
Adolescents who described their decisions as being intuitive had measurably worse financial outcomes fifteen years later than their peers who had favored deliberation.
Consumers learn less well from available financial information about losses (as opposed to gains). Additionally, learning performance is in part due to genetic factors affecting memory and cognitive control.
The Effect of Financial Literacy on Downstream Financial Behaviors
A meta-analysis of 160 prior studies reveals a vanishingly small relationship between financial education and subsequent financial behavior, suggesting the need for a reevaluation of the large sums spent on financial education around the world.
Analysis of online discussion about money shows that consumers use these forums for social support and for financial information that is quite different from what is provided in traditional financial education.
Consumers—particularly less sophisticated ones—have difficulty making consistent, utility-maximizing decisions regarding annuity streams; inability to handle complexity, rather than a desire for lump sums, seems to be the cause.
To determine why retirement annuities are under-pursued, this study examines multiple consumer annuity preferences, finding consumers are sensitive to emotional and non-normative factors unrelated to the net present value (NPV) of the annuity.
Systematic Biases in Investor Self-Prediction of Future Risk Tolerance
Investors think they would be equally risk tolerant for individual investments as for broader buckets of investments, but they are not; they are substantially less risk tolerant for individual investments than they expect themselves to be.
Firms are offering retirees lump sums to give up their pensions, but this research indicates that consumers often perceive lump sums to have a greater value than the corresponding annuity stream, possibly influencing individuals to accept lump sums that lower their retirement income.
Ostriches, Owls, and Black Swans: Quasi-Rational Biases in Seeking Information about the Riskiness of Assets
In high-risk, high-return financial decisions, consumers undervalued information about the probability of a catastrophic loss (an ostrich effect) while consumers considering low-risk, low-return financial decisions overvalued such information (an owl effect).
During times of crisis, instead of increasing portfolio diversification, as is normal during less turbulent times, investors actually decrease the diversification of their portfolios by moving away from actively managed funds into more familiar investments.
Current disclosures provide the same information content and format to all consumers, but the regulatory future is in personalized disclosures that utilize the individual information of the consumer.
The authors report randomized experiments showing the effectiveness of a new product focusing on reducing expensive debt for households, based on principles from behavioral economics.
The authors show how and why innumerate consumers fail to realize how long it will take to pay down a given debt, how much the balance will be at the end of the year if they pay a certain amount per month, or how much they have to pay per month in order to clear a debt in 3 years.
Mathematical abilities measured early in life predict mistakes in use of credit later in life that result in exceptional interest charges for use of home equity loans or lines of credit.
As we age, “fluid intelligence” declines but “crystallized intelligence” increases to compensate, and the authors relate these changes to changes in financial and debt literacy across the lifespan.
People with positive net worth feel wealthier when they have low debt and low assets rather than high debt and high assets. People with negative net worth are the opposite: they feel wealthier when they have high assets but high debt.
The authors investigate cultural changes in how consumers regard debt and debtors, representing the idea that heavy use of credit and debt is the “American Way.”
Those who start a not-for-profit Debt Management Plan improve credit scores and reduce incidence of bankruptcy over a three-year period compared to observationally equivalent debtors.
The authors explain the landscape of not-for-profit and for-profit debt relief organizations, analyzing misaligned incentives of for-profit firms who take payments before delivering benefits, and the problems of consumers in identifying which organizations will actually deliver benefits.
A national survey shows little evidence that receiving financial advice does not, on average, improve the performance of one’s defined contribution retirement plan. Later experiments show advice helps only when one asks for it, not when it is thrust upon one.
Standard theory says that investors’ stock portfolios should be tailored to their risk preferences, and the authors show that people are willing to pay substantial fees, but enthusiasm dwindles when they see the effect of increased fees on their net returns.
Life annuities are attractive as a way to avoid outliving one’s wealth if one thinks one will live longer than average. People are biased to think they will live much longer if asked to estimate the chance they will live to age 85 than if asked the chance they will die by age 85.
Delaying the age at which one starts claiming Social Security benefits is smart for many consumers. The researchers show how the framing of how Social Security Administration frames the decision has the unintentional effect of making earliest possible claiming seem to be the reference point.
The authors report findings from a remarkable randomized experiment by the state of Oklahoma where some children were given access to a matched college savings program at birth.
The authors show how individuals violate expected utility theory in allocating savings in a defined contribution retirement plan, particularly those low in numeracy.
Investors choose the same fraction of risky versus riskless assets when the risky asset has high return for taking risk as when it has low return for taking risk.
Theory says that historical stock performance doesn’t predict the future, but regret causes investors to shy away from buying stocks they have owned in the past if they lost money or the stock appreciated after they sold it.
One thing Boulder is known for is its microbreweries. Boulder is known as the capitol (or Napa Valley) of craft beers. So it would make no sense whatsoever to be in Boulder and to not make an event of this! So here is what we’re going to do:
We will start a walking tour of Boulder microbreweries, leaving from in front of the conference hotel (the St Julien) at 3:45 on Saturday, May 18th. The walking tour lasts about 3 hours and we will stop by several local breweries to purchase some samples and experience the atmosphere. We will return to the conference hotel about 6:45, just in time for you to take advantage of one of the many great restaurants in the Pearl Street Mall area.
The breweries can accommodate only a limited number of visitors at one time so register as soon as possible using the link at the top of the page. So whattadayasay, come a day early and join the fun! Contact conference manager Rachel Ford at rachel.ford@colorado.edu with any questions.
Sunday Morning, May 19th
Eldorado Canyon State Park Hike
At 8:30 AM on Sunday, May 19th, a number of local conference attendees will pick up hikers outside the St. Julien and take us to Eldorado Canyon State Park. Eldorado Canyon is a hidden treasure right in Boulder’s back yard. We are at about 6000 feet and it may be cool inside the canyon so bring a sweater or sweatshirt. We will all start out on the easy “Fowler Trail” and those who wish may branch off to take the more moderate “Goshawk Ridge Loop.”
Fowler Trail
This easy trail provides a great place to watch rock climbers or simply enjoy dramatic views of the canyon. The trail is 0.7 miles (one way) to the park boundary. The first half of the trail is wheelchair accessible. A series of watchable wildlife interpretive signs can be found along the trail. Make sure to pick up a self-guided nature walk brochure to explore Eldorado Canyon’s unique environment.
Goshawk Ridge Trail
This moderately difficult trail is a 1.2 mile loop (a total of 3.1 miles including the Fowler Trail access). The hike winds past several historic sites including a cattle herder’s cabin used in the 1920s and 30s and remnants of old railroad camps. The trail offers fantastic views of the canyon and crags around Eldorado Springs. Be sure to bring sunscreen and sunglasses for this trail as it is mostly exposed to the sun. The full trail (the loop plus the Fowler Trail access) will probably not take more than two hours to complete including stops to take pictures of the spectacular scenery and look for wildlife. When we finish, we'll return to Boulder in time for a late lunch.
Families and spouses are welcome. Register using the link at the top of the page. If you have any questions, please contact conference manager Rachel Ford at rachel.ford@colorado.edu. There is no charge for this hike, other than paying the entry fee into the park ($8 per car in cash).
Dining
We will be together for breakfasts, lunches, and receptions and we will be on our own for dinners.
See this Wall Street Journal article reviewing several outstanding Boulder restaurants. Boulder was recently named 'Foodiest Town in America' by Bon Appetit.
Salt, The Kitchen, and the Black Cat are all within an easy walk of the St Julien. Frasca is a slightly longer walk, about 8 blocks.
Please see this map for various locations we will visit together and some to visit on your own right by the St Julien.
If you have a day or two to spend in the area, here are some popular tourist spots:
Peak to Peak Highway from Blackhawk (about 35 minutes from Boulder) to Estes Park. It is easy to spend a day shopping in Estes Park.
Red Rocks: Home of the famous outdoor amphitheater.
Summit County
Summit County is the mountain playground for people from Denver and you can do any possible outdoor activity there in spectacular settings.... hike, bike, sail, horseback ride, golf, etc.
This is due east from Denver on I-70. It's about 1 hour and 40 minutes from Boulder. Spend the day either in the charming towns (Frisco old west, Breckenridge more victorian old west).
Image by Brian Dearth
If you can spend time in this area, there are fabulous hikes -- especially for those who like wildflowers.
One of our favorites is Shrine Mountain Pass. Go from Summit County west on I-70 to Vail Pass, get off and drive on dirt road to Shrine Mountain. Hike (about 2 hours, not too strenuous) to incredible overlook of shrine mountain, spectacular wildflowers that time of year. It is critical to get an early start in the morning. In that part of the state, mornings are always crystal clear blue sky days and afternoons are prone to early thundershowers.
Denver
If you are interested in more civilized stuff rather than all outdoorsy, in Denver itself, the Denver Art Museum and the Denver Museum of Nature and Science are both quite good.
Post-Conference Fun (On Your Own)
If you'd like to do something on your own either before or after the conference, here are some ideas:
White Water Rafting
If you’ve never been white water rafting, it’s a real kick!
Pete McGraw has the inside scoop on where to go, and what rafting company to use. He recommends Echo Canyon/Four Corners Rafting. Echo Canyon is the biggest raft outfitter in Colorado. They raft different parts and levels of the Arkansas River, so they have a variety of options for different group needs. Levels 2/3 like Browns Canyon and Big Horn Sheep are more family friendly, but higher Level 4 like Royal Gorge and Numbers are also available. (Higher numbers are rougher waters!)
Several of us have done Browns Canyon and it is beautiful. It’s probably about a 2.5 hour drive from Boulder, but it is a scenic drive.
If you are interested, here is the contact info:
Echo Canyon River Expeditions/ Four Corners Rafting
45000 US Highway 50 West
Canon City, CO 81212
800.748.2953 www.raftecho.com or www.fourcornersrafting.com.
Bike Trails
Boulder is one of the most bike-friendly communities there is. There is road and off-road biking for all skill levels. For more information on bike rentals and alternate routes:
www.getboulder.com/sports/sports_bicycle.html
Hiking
You say you want to go hiking? We have you covered there too as Boulder has fantastic trails! Check out this website.
Rocky Mountain National Park
Another beautiful drive is from Boulder, through Estes Park, to Rocky Mountain National Park. And when you get there, boy is it beautiful... with some fantastic hikes. Website
Summit County
If you really want the Rocky Mountain experience, drive west on 1-70 to the other side of the Eisenhower Tunnel (about a 90 minute drive) and take in the beautiful mountain towns. Summit County is the mountain playground for people from Denver and you can do any possible outdoor activity there in spectacular settings.... hike, bike, sail, horseback ride, golf, etc.
This is due east from Denver on I-70. It's about 1 hour and 40 minutes from Boulder. Spend the day either in the charming towns (Frisco old west, Breckenridge more victorian old west). If you can spend time in this area, there are fabulous hikes -- especially for those who like wildflowers.
One of our favorites is Shrine Mountain Pass. Go from Summit County west on I-70 to Vail Pass, get off and drive on dirt road to Shrine Mountain. Hike (about 2 hours, not too strenuous) to incredible overlook of shrine mountain, spectacular wildflowers that time of year. It is critical to get an early start in the morning. In that part of the state, mornings are always crystal clear blue sky days and afternoons are prone to early thundershowers.
Gambling
Yep, we have that too in Blackhawk and historic Central City, about an hour away.
City Life
If you prefer what a city has to offer, of course Denver is only 30 miles away.
Boulder
If you want to just hang in Boulder, there are a bunch of things to do here too, both for families during the conference, and for pre and post conference fun! Visitor Information Shopping
Getting to Boulder
Three means of getting to the conference hotel (the St Julien) in Boulder are by renting a car and driving, taking the Boulder SuperShuttle, or taking the public bus service (RTD). Below is information on each.
Rental Car
If you will be renting a car at DIA and driving to the St. Julien Hotel in Boulder, there is a toll route. Use this link for a map that has links for three routes you can take. Use either route 1 (E-470 N, about 47 minutes, $9 toll) or route 2 (US 36-W, about 52 minutes, no toll). In either case, you will enter Boulder by coming south on US-36, whichturns into 28th Street once inside Boulder. It is hard to get lost in Boulder because the mountains are always to the west. 28th street is a major North-South street to the east of the St. Julien. Take 28th Street to Canyon Blvd., take a left (west, toward the mountains) on Canyon Blvd. Continue west on Canyon Blvd. to 9th Street, take a right on 9th Street, then take your first right on Walnut Street. The hotel entrance will be on your right.
Boulder Shuttle
Another way to get to the St. Julien Hotel is by the Boulder Supershuttle. This service will pick you up at DIA and take you to the St Julien Hotel, and take you from the hotel back to the Airport.If you have any questions regarding fares, destinations, service areas, confirmations or any other reservation specific questions, email reservations@supershuttle.net or call 800.BLUE.VAN (800.258.3826).
Town Car
Contact the St. Julien Concierge Desk to set up a town car to pick up hotel guests. The cost is $120 including gratuity each way, with the advantage being that the trip takes 45 minutes instead of the hour and a half (estimated time of Supershuttle).
Taxi
The cost of a taxi is about $100.00 not including gratuity.
RTD Bus
A third way to get between DIA and Boulder is by bus (RTD). Here is the RTD schedule between DIA and Boulder. (Note the pickup locations at DIA.) The "West Bound" link on this website shows the final destination in Boulder at the RTD bus terminal at the intersection of 14th Street and Walnut. This is very close to the St. Julien. If you walk five blocks west on Walnut Street, you are at the St. Julien.
Conference Locations
Please see the map at this link to see where the St. Julien is relative to places we will eat and drink during the conference. You can click on the little icons to see when we will be at each location.
Instructions for Poster Presenters
Reception
On Sunday evening of the Boulder Summer Conference, we have a cocktail party reception focused on posters by authors of highly rated papers submitted to the conference. It is a great opportunity for deep and informal dialog with others working in the author’s particular area.
A poster presentation should be self-explanatory, allowing different viewers to proceed on their own while the author is free to supplement and discuss particular points raised in inquiry. The poster session offers a more intimate forum for information exchange than does the traditional spoken presentation, but discussion becomes difficult if the author is obliged to spend most of the time merely explaining the poster to a succession of visitors.
Dimensions
Each of you will have a space that is 46 inches wide by 48 inches high (116.8 cm. wide x 121.9 cm high). (The brackets on either side of each poster take a little real estate, giving you a rectangle rather than a square.)
Numbering
Each poster will be assigned a number in the program. The boards will be grouped serially in the room to help participants locate specific presentations.
Before the Meeting
Title
Prepare a banner for the top of your poster indicating the title, authors, and affiliations. Lettering in the label should be at least 1 in. (2.5 cm) high.
Illustrations
Figures should be designed to be viewed from a distance, and should use clear, visible graphics. Although each figure should illustrate no more than one or two major points, figures need not be simple. The main points should be clear without extended viewing, but detail can be included for the knowledgeable viewer. Remember that the time spent at each poster figure is determined by the viewer, not by the presenter, as in the case of a slide presentation in a spoken session.
Each figure or table should have a heading of one or two lines in large type stating the “take-home” message. Detailed information should be provided in a legend below in smaller type. Because there is no text accompanying a poster, the figure legend should contain commentary that would normally appear in the body (Results and Discussion) of a manuscript. It should describe concisely not only the content of the figure but also the conclusions derived from it. Details of methodology should be kept brief and should be placed at the end of the legend.
Layout
Materials should be mounted on colored poster paper or board. It is helpful to group logically consistent sections of the presentation on the same background color. Muted colors provide an effective background. Use thin mounting board. Heavy board is difficult to keep positioned properly.
Arrange materials in columns rather than in rows. It is easier for viewers to scan a poster by moving systematically along it rather than by zigzagging back and forth in front of it. An introduction should be placed at the upper left and a conclusion at the lower right, both in large type. The sequence of illustrations should be indicated with numbers or letters at least 1 in. high, preferably in bold print. (Omit “Fig” or “Figure”; it is unnecessary and occupies too much space.)
You may find it convenient to have a separate section describing methods, but it is quite effective to include this information as part of the data presentation, as described above. Carefully chosen photographs of apparatus, or schematic diagrams of procedures, can convey a great deal of information about methods without much text. Most viewers will tend to skim or ignore long textual passages.
Including Your Poster in a Memory Stick of All Conference Presentations
All conference attendees receive a memory stick with the papers presented in the plenary sessions or powerpoint presentations. We want to include a pdf of each poster in those materials. Poster authors should upload the pdf of their poster 10 days before the conference through a qualtrics email link that will be sent to all poster authors.
