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A Laboratory Study of Nudge with Retirement Savings

Dina Tasneem (), Audrey Azerot, Marine de Montaignac and Jim Engle-Warnick

CIRANO Working Papers from CIRANO

Abstract: We report results from an on-line economics experiment that examines the effect of nudging retirement savings decisions. In the experiments, participants make decisions in a finitely repeated retirement savings game, in which income during working years is uncertain, and retire-ment age is known. Participants, who are household financial decision-makers, are nudged with automatic savings in each period of the game. We find that that the nudge simply replaced nat-ural decision-making observed in the absence of a nudge in this experiment, even to the extent that it resulted in nearly identical inferred decision rules. This surprising result highlights the unpredictability of the effect of nudging human behavior.

Keywords: Precautionary Savings; Retirement Savings; Life-cycle Models; Dynamic Optimization; Decision Heuristics; Nudge; Choice Architecture (search for similar items in EconPapers)
JEL-codes: C91 E21 C61 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-age, nep-cbe, nep-exp, nep-gth, nep-mac and nep-upt
Date: 2018-07-23
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