International Journal of Business and Economics

International Journal of Business and Economics
Volume 15, No. 1

June, 2016
Plan-Level and Firm-Level Attributes and Employees' Contributions to 401(k) Plans
Hsuan-Chi Chen
Anderson School of Management, University of New Mexico, U.S.A.
Christine W. Lai
Graduate Institute of Management, National Taiwan Normal University, Taiwan
Sheng-Ching Wu
Department of Finance, Da-Yeh University, Taiwan
This study examines the determinants of employee contributions to 401(k) plans from the perspective of corporate policy and employer matching. Based on a sample of 756 401(k) plans from 2000 through 2004, we identify several significantly positive factors related to employees’ contribution decisions. These factors include the presence of an employer match, especially matching by cash, the firm’s growth opportunity, corporate dividend payment, stock return performance, and employees’ autonomy to change their investment arbitrarily.
Keywords:401(k) plans, employee contributions, matching policy.
JEL Classifications:G23, G32, J26.