Abstract

The government of Hong Kong Special Administrative Region (HKSAR) launched the Mandatory Provident Fund (MPF) scheme as a major source of retirement protection. Now, over 2.6 million employees and self-employed persons are currently making contribution to this scheme and they are required to decide on allocation of their MPF contributions to different MPF choices. However, we know little about how their decisions are formed. One major contribution of this study is to investigate people’s perceptions of MPF and their preferences of MPF choices. And, this study has adopted the predictions of prospect theory, in order to explain why risky choices are more attractive to the public. Findings indicated that more individuals perceived MPF contribution as a loss, than those who perceived it as a gain; those who perceived MPF as a loss generally made higher contributions to the risky fund.

This work is licensed under a Creative Commons Attribution 4.0 License.