When Nudges are Forever: Inertia in the Swedish Premium Pension Plan
AEA Papers and Proceedings, Vol. 108 May 2018
14 Pages Posted: 17 Jan 2018 Last revised: 27 Oct 2018
Date Written: January 10, 2018
To inform economists and policy makers about whether the effects of nudges are persistent in one specific context, we study the choice architecture of the Swedish Premium Pension Plan. The data we study consist of all initial choices and subsequent rebalancing activities by the entire population of 7.3 million retirement savers in Sweden during the period 2000 to 2016. Based on our analysis of these data, we conclude that the effects of nudging in this case were surprisingly persistent and seem to last nearly two decades, if not forever.
Keywords: behavioral economics, retirement saving, pension, nudge, default choice
JEL Classification: G02, D14, D03
Suggested Citation: Suggested Citation