Are People Systematically Inactive Across Financial Decisions? Linking Evidence from Mortgage and Retirement Saving Decisions

Henrik Yde Andersen, Camilla Skovbo Christensen, Claus Thustrup Kreiner and Soeren Leth-Petersen
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Henrik Yde Andersen: Danmarks Nationalbank
Camilla Skovbo Christensen: Department of Economics, University of Copenhagen
Claus Thustrup Kreiner: Department of Economics, University of Copenhagen
Soeren Leth-Petersen: Department of Economics, University of Copenhagen

No 25-11, CEBI working paper series from University of Copenhagen. Department of Economics. The Center for Economic Behavior and Inequality (CEBI)

Abstract: Many people forgo substantial economic gains by not responding to financial incentives, even in major decisions such as retirement savings and mortgage refinancing. But do the same people systematically fail to respond across financial contexts? We study this using a quasi-experimental setting that combines policy changes in pension incentives with shifts in mortgage refinancing incentives from interest rate fluctuations. Linking Danish administrative records, we uncover a striking independence between financial decisions: people who are inactive in one context are not systematically inactive in the other. One implication is that the costs of inaction are not concentrated among specific groups.

Keywords: Tax incentives for pension savings; Mortgage refinancing; inaction (search for similar items in EconPapers)
JEL-codes: G51 H24 (search for similar items in EconPapers)
Pages: 36
Date: 2025-09-16
New Economics Papers: this item is included in nep-age and nep-eur
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Persistent link: https://EconPapers.repec.org/RePEc:kud:kucebi:2511

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