Spending from regulated retirement drawdowns: The role of implied endorsement

Scandinavian Journal of Economics 123(3), 810–847

50 Pages Posted: 19 Apr 2018 Last revised: 30 Nov 2021

See all articles by Jennifer Alonso-García

Jennifer Alonso-García

Université Libre de Bruxelles (ULB) - Department of Mathematics; ARC Centre of Excellence in Population Ageing Research; Netspar

Hazel Bateman

UNSW Sydney, CEPAR

Johan Bonekamp

Tilburg University - Department of Econometrics & Operations Research

Ralph Stevens

CPB Netherlands Bureau of Economic Policy Analysis; CEPAR

Date Written: October 17, 2019

Abstract

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

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

Jennifer Alonso-García (Contact Author)

Université Libre de Bruxelles (ULB) - Department of Mathematics ( email )

Brussels
Belgium

ARC Centre of Excellence in Population Ageing Research ( email )

Level 6, Central Lobby (enter via East Lobby)
Australian School of Business Building
Sydney, New South Wales NSW 2052
Australia

Netspar ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

Hazel Bateman

UNSW Sydney, CEPAR ( email )

High Street
Sydney, NSW 2052
Australia

Johannes Bonekamp

Tilburg University - Department of Econometrics & Operations Research ( email )

Tilburg, 5000 LE
Netherlands

Ralph Stevens

CPB Netherlands Bureau of Economic Policy Analysis ( email )

P.O. Box 80510
2508 GM The Hague, 2585 JR
Netherlands

HOME PAGE: http://https://www.cpb.nl/medewerkers/ralph-stevens

CEPAR ( email )

Sydney, NSW 2052
Australia
+61 2 9385 1883 (Fax)

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