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Abstract

We develop and test a simple model of limited attention in intertemporal choice. The model posits that individuals fully attend to consumption in all periods but fail to attend to some future lumpy expenditure opportunities. This asymmetry generates some predictions that overlap with other models of present-bias. Our model also generates the unique predictions that reminders will increase saving, and that a reminder that makes a specific expenditure more salient will be especially effective. We find support for these predictions in three field experiments that randomly assign reminders to new savings account holders.

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File URL: http://crr.bc.edu/working-papers/getting-to-the-top-of-mind-how-reminders-increase-saving/
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Bibliographic Info

Paper provided by Center for Retirement Research in its series Working Papers, Center for Retirement Research at Boston College with number wp2010-2.

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Length: 43 pages
Date of creation: Apr 2010
Date of revision:
Handle: RePEc:crr:crrwps:wp2010-2

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Find related papers by JEL classification:

• D91 - Microeconomics - - Intertemporal Choice and Growth - - - Intertemporal Consumer Choice; Life Cycle Models and Saving
• E21 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth

References

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Blog mentions

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1. Nudge Database IV
   by Mark Egan in Economics, Psychology and Policy on 2013-04-14 16:17:00

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Cited by:

1. Victor Stango & Jonathan Zinman, 2011. "Limited and Varying Consumer Attention: Evidence from Shocks to the Salience of Bank Overdraft Fees," NBER Working Papers 17028, National Bureau of Economic Research, Inc.
   
   • Victor Stango & Jonathan Zinman, 2011. "Limited and varying consumer attention: evidence from shocks to the salience of bank overdraft fees," Working Papers 11-17, Federal Reserve Bank of Philadelphia.
2. Dena Ringold & Alaka Holla & Margaret Koziol & Santhosh Srinivasan, 2012. "Citizens and Service Delivery : Assessing the Use of Social Accountability Approaches in the Human Development Sectors," World Bank Publications, The World Bank, number 2377, 5.
3. Buehren, Niklas, 2011. "Allocating Cash Savings and the Role of Information: Evidence from a Field Experiment in Uganda," Proceedings of the German Development Economics Conference, Berlin 2011 16, Verein für Socialpolitik, Research Committee Development Economics.
4. Brune, Lasse & Gine, Xavier & Goldberg, Jessica & Yang, Dean, 2011. "Commitments to save : a field experiment in rural Malawi," Policy Research Working Paper Series 5748, The World Bank.
5. Altmann, Steffen & Traxler, Christian, 2012. "Nudges at the Dentist," IZA Discussion Papers 6699, Institute for the Study of Labor (IZA).
   
   • Steffen Altmann & Christian Traxler, 2012. "Nudges at the Dentist," Working Paper Series of the Max Planck Institute for Research on Collective Goods 2012_15, Max Planck Institute for Research on Collective Goods.
6. Michael Hamp & Carolina Laureti, 2011. "Balancing flexibility and discipline in microfinance: Innovative financial products that benefit clients and service providers," Working Papers CEB 11-044, ULB -- Universite Libre de Bruxelles.
7. Pascaline Dupas & Jonathan Robinson, 2011. "Why Don't the Poor Save More? Evidence from Health Savings Experiments," NBER Working Papers 17255, National Bureau of Economic Research, Inc.
8. B. Douglas Bernheim & Andrey Fradkin & Igor Popov, 2011. "The Welfare Economics of Default Options: A Theoretical and Empirical Analysis of 401(k) Plans," NBER Working Papers 17587, National Bureau of Economic Research, Inc.

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