Consumer Demand for Prize-Linked Savings: A Preliminary Analysis
Jan‐Emmanuel De Neve
University of Oxford
University of Oxford - Said Business School; National Bureau of Economic Research (NBER); University of Oxford - Said Business School
February 8, 2008
Harvard Business School Finance Working Paper No. 08-061
This paper reports on a small-scale survey of the potential American demand for prize-linked savings accounts, an account that awards prizes as part of the saving product's return. In October 2006, Centra Credit Union launched a prize-linked savings pilot. As part of that initiative, we conducted a mall intercept survey of over 500 people in Clarksville, Indiana, the community where the program was launched. This preliminary data suggests that low-to-moderate income Americans may have substantial demand for prize-linked savings, with a majority of survey participants expressing an interest in opening a prize-linked savings account. As predicted by theory and international experience, interest in prize-linked savings is greatest among people who do not have regular saving habits, who have little actual savings, who play lotteries extensively, and who are optimistic about their futures.
Number of Pages in PDF File: 30
Date posted: February 11, 2008 ; Last revised: November 16, 2008
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