Greener pensions, greener choices: Linking investments to sustainable behavior

Olga Balakina, Charlotte Christiansen and Malene Kallestrup-Lamb

No 452, SAFE Working Paper Series from Leibniz Institute for Financial Research SAFE

Abstract: This paper examines how offering sustainable investment options influences sustainable consumption behavior. We combine a natural experiment in which individuals receive an option to switch to a pension plan with a strong sustainability profile with detailed household register data. This sustainable option improves sustainable consumption, as reflected in electric vehicle adoption and reduced vehicle emissions. The effect is primarily driven by individuals who do not choose the sustainable plan. We show that making sustainable investment available can create positive spillover effects on other sustainable behaviors, highlighting the potential of financial tools to support broader societal change.

Keywords: Household finance; sustainable investments; sustainable consumption; pension investments; sustainable pension plans; electric vehicles (search for similar items in EconPapers)
JEL-codes: D14 G11 G51 (search for similar items in EconPapers)
Date: 2025
New Economics Papers: this item is included in nep-tre
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:safewp:324640

DOI: 10.2139/ssrn.5356784

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