What Might We Forget? An Experiment in South Africa Showing When Reminders May Increase Attention and Decrease Savings

Abstract

Using administrative data on the savings behaviour of 31,246 South Africans at the onset of COVID, this experimental study demonstrates how reminders can decrease savings in a crisis. Building on an attention-based model for the effect of reminders, it shows how if individuals have forgotten prior savings, a savings reminder can increase dis-saving when received at a time when those savings may be needed. While this may still be utility enhancing, this study demonstrates that focusing on an instrumental variable like savings can miss the full potential impact of an attention-enhancing technology like reminders.

Keywords: Savings, reminders, south africa