Limited and Varying Consumer Attention: Evidence from Shocks to the Salience of Bank Overdraft Fees
Victor Stango and
Jonathan Zinman ()
No 17028, NBER Working Papers from National Bureau of Economic Research, Inc
We explore dynamics of limited attention in the $35 billion market for checking overdrafts, using survey content as shocks to the salience of overdraft fees. Conditional on selection into surveys, individuals who face overdraft-related questions are less likely to incur a fee in the survey month. Taking multiple overdraft surveys builds a "stock" of attention that reduces overdrafts for up to two years. The effects are significant among consumers with lower education and financial literacy. Individuals avoid overdrafts by making fewer low-balance debit transactions and cancelling automatic recurring withdrawals. The results raise new questions about consumer financial protection policy.
JEL-codes: D14 D18 G13 G21 (search for similar items in EconPapers)
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Published as Victor Stango & Jonathan Zinman, 2014. "Limited and Varying Consumer Attention: Evidence from Shocks to the Salience of Bank Overdraft Fees," Review of Financial Studies, vol 27(4), pages 990-1030.
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Journal Article: Limited and Varying Consumer Attention: Evidence from Shocks to the Salience of Bank Overdraft Fees (2014)
Working Paper: Limited and varying consumer attention: evidence from shocks to the salience of bank overdraft fees (2011)
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