Why Do Defaults Affect Behavior? Experimental Evidence from Afghanistan /
Blumenstock, Joshua.
Why Do Defaults Affect Behavior? Experimental Evidence from Afghanistan / Joshua Blumenstock, Michael Callen, Tarek Ghani. - Cambridge, Mass. National Bureau of Economic Research 2017. - 1 online resource: illustrations (black and white); - NBER working paper series no. w23590 . - Working Paper Series (National Bureau of Economic Research) no. w23590. .
July 2017.
We report on an experiment examining why default options impact behavior. By randomly assigning employees to different varieties of a salary-linked savings account, we find that default enrollment increases participation by 40 percentage points--an effect equivalent to providing a 50% matching incentive. We then use a series of experimental interventions to differentiate between explanations for the default effect, which we conclude is driven largely by present-biased preferences and the cognitive cost of thinking through different savings scenarios. Default assignment also changes employees' attitudes toward saving, and makes them more likely to actively decide to save after the study concludes.
System requirements: Adobe [Acrobat] Reader required for PDF files.
Mode of access: World Wide Web.
Why Do Defaults Affect Behavior? Experimental Evidence from Afghanistan / Joshua Blumenstock, Michael Callen, Tarek Ghani. - Cambridge, Mass. National Bureau of Economic Research 2017. - 1 online resource: illustrations (black and white); - NBER working paper series no. w23590 . - Working Paper Series (National Bureau of Economic Research) no. w23590. .
July 2017.
We report on an experiment examining why default options impact behavior. By randomly assigning employees to different varieties of a salary-linked savings account, we find that default enrollment increases participation by 40 percentage points--an effect equivalent to providing a 50% matching incentive. We then use a series of experimental interventions to differentiate between explanations for the default effect, which we conclude is driven largely by present-biased preferences and the cognitive cost of thinking through different savings scenarios. Default assignment also changes employees' attitudes toward saving, and makes them more likely to actively decide to save after the study concludes.
System requirements: Adobe [Acrobat] Reader required for PDF files.
Mode of access: World Wide Web.