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A nudge to quit? The effect of a change in pension information on annuitization, labor supply and retirement choices among older workers

Johannes Hagen, Daniel Hallberg and Gabriella Sjögren Lindquist

No 209, GLO Discussion Paper Series from Global Labor Organization (GLO)

Abstract: Nudge is about affecting behavior in a certain way through small changes to the choice architecture. However, a nudge may also affect behaviors that the architect did not intend. We show that such spillover effects exist in a highly policy relevant context where the use of nudge is widespread; retirement. Specifically, we find that an exogenous application form change in the Swedish pension system that highlighted a five-year payout on the expense of a life annuity not only increased the demand for the nudged payout (as expected), but also induced individuals to retire earlier. We attribute the effects to decision-framing.

Keywords: annuity; pension; nudge; decision framing (search for similar items in EconPapers)
JEL-codes: D91 G41 J26 J32 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-age, nep-eur and nep-lma
Date: 2018
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