Different defaults affect different groups differently

Jochem de Bresser and Marike Knoef

Journal of Economic Behavior & Organization, 2025, vol. 231, issue C

Abstract: We analyze heterogeneity in default effects on retirement saving in a randomized survey experiment. In the Dutch context of universal, mandatory, and high pensions, respondents make realistic choices in which they can maintain the status-quo, suspend, or double pension contributions for one, three, or five years. The aggregate effect sizes of defaults at a three-year suspension and doubling of contributions are similar, increasing the fraction choosing these options by 22%-points. The former most strongly affects those with low incomes and high pension entitlements, while the latter affects patient, non-procrastinating, and especially impulsive individuals. Average savings are influenced in different directions, depending on the alternatives that individuals would have chosen in absence of the default. When setting defaults, it is important to consider variation in counterfactuals.

Keywords: Defaults; Retirement saving; Decision making; Heterogeneous effects (search for similar items in EconPapers)
JEL-codes: D14 D31 D91 J14 (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0167268124004906
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:231:y:2025:i:c:s0167268124004906

DOI: 10.1016/j.jebo.2024.106876

Access Statistics for this article

Journal of Economic Behavior & Organization is currently edited by Houser, D. and Puzzello, D.

More articles in Journal of Economic Behavior & Organization from Elsevier
Bibliographic data for series maintained by Catherine Liu ().