What Might We Forget? An Experiment in South Africa Shows that Reminders May Increase Attention and Decrease Savings, But a Lottery May Counteract These Effects

34 Pages Posted: 1 Jul 2024

See all articles by Amy Jansen

Amy Jansen

affiliation not provided to SSRN

Robert Lensink

University of Groningen - Department of Economics, Econometrics and Finance; Wageningen University and Research (WUR) - Development Economics Group

Abstract

Using administrative data on the savings behaviour of 41,672 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. The study also suggests that enhancing a savings reminder with a lottery incentive for 4 months will undo the negative effects of a savings reminder on savings during a crisis.

Keywords: Reminder, South Africa, BANKING, Savings, Lottery, behavioral finance, Experimental Study

Suggested Citation

Jansen, Amy and Lensink, Robert, What Might We Forget? An Experiment in South Africa Shows that Reminders May Increase Attention and Decrease Savings, But a Lottery May Counteract These Effects. Available at SSRN: https://ssrn.com/abstract=4880261 or http://dx.doi.org/10.2139/ssrn.4880261

Amy Jansen

affiliation not provided to SSRN ( email )

No Address Available

Robert Lensink (Contact Author)

University of Groningen - Department of Economics, Econometrics and Finance ( email )

P.O. Box 800
9700 AH Groningen
Netherlands

Wageningen University and Research (WUR) - Development Economics Group ( email )

Hollandseweg 1
WAGENINGEN, 6706 KN
Netherlands

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