Spending from regulated retirement drawdowns: The role of implied endorsement

We fielded an online survey in the Netherlands and Australia to explore the influence of an implied endorsement nudge, conveyed by a government regulated drawdown from pension wealth, on spending patterns in retirement. The implied endorsement nudge was effective. It influenced the preferred retirement spending patterns of around 30\% of survey participants, particularly those with fewer financial resources and low pension capability. Australian participants were more likely to follow the nudge where it was framed as implicit government advice while the Dutch were more likely to respond to a suggestion that the nudge was a recommendation from peers. Our results provide support for a regulated drawdown rule as part of a strategy to guide spending patterns in retirement.

Keywords: decumulation policy, regulated drawdowns, implied endorsement, peer effects

JEL Classification: D14, D90, J14, J26

Suggested Citation: Suggested Citation

Alonso-García, Jennifer and Bateman, Hazel and Bonekamp, Johannes and Stevens, Ralph, Spending from regulated retirement drawdowns: The role of implied endorsement (October 17, 2019). Scandinavian Journal of Economics 123(3), 810–847, Available at SSRN: https://ssrn.com/abstract=3154907 or http://dx.doi.org/10.2139/ssrn.3154907