Benefits Left on the Table: Evidence from the Servicemembers’ Civil Relief Act

48 Pages Posted: 8 Jan 2020

See all articles by Benjamin Castleman

Benjamin Castleman

University of Virginia

Richard Patterson

Cornell University - Department of Policy Analysis and Management; United States Military Academy

Bill Skimmyhorn

Mason School of Business, College of William & Mary; U.S. Army Office of Economic and Manpower Analysis

Date Written: December 12, 2018

Abstract

In this study we test whether behaviorally-motivated informational interventions can lead individuals to utilize consumer financial protections. Specifically, we use a large-scale randomized controlled trial to test whether gain/loss framing and reminder messaging can lead servicemembers in the United States Army to utilize an interest-rate protection outlined in the Servicemember Civil Relief Act (SCRA). While we find that reminder messaging increases engagement with informational materials, we find no differences in engagement across gain and loss framing. Furthermore, we find that information provision has no effect on servicemember credit outcomes, regardless of how SCRA protections are framed or whether email reminders are sent. We run a second experiment to explore what factors may be limiting the efficacy of our interventions and find that low engagement with emails and significant attrition throughout the application process are likely to contribute to our results. Taken together, our results suggest that financial education or information interventions offered via email face significant challenges to their effectiveness even when the apparent benefits seem large.

Keywords: Servicemembers Civil Relief Act, Household finance, Consumer protections

Suggested Citation

Castleman, Benjamin and Patterson, Richard and Patterson, Richard and Skimmyhorn, William, Benefits Left on the Table: Evidence from the Servicemembers’ Civil Relief Act (December 12, 2018). Economics of Education Review, 2019, Available at SSRN: https://ssrn.com/abstract=3505555

Benjamin Castleman

University of Virginia ( email )

1400 University Ave
Charlottesville, VA 22903
United States

Richard Patterson

Cornell University - Department of Policy Analysis and Management ( email )

Ithaca, NY
United States
(435) 640-9054 (Phone)

HOME PAGE: http://https://sites.google.com/site/richpattersoncornell/

United States Military Academy ( email )

600 Thayer Rd
West Point, NY 10996
United States
(435) 640-9054 (Phone)

William Skimmyhorn (Contact Author)

Mason School of Business, College of William & Mary ( email )

Williamsburg, VA
United States

HOME PAGE: http://https://mason.wm.edu/faculty/directory/full-time-faculty/skimmyhorn_w.php

U.S. Army Office of Economic and Manpower Analysis ( email )

West Point, NY
United States

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