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How to Communicate the Nudge: A Real-World Policy Experiment

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  • Oren Bar-Gill
  • Alma Cohen

Abstract

Disclosure-based nudges are increasingly utilized by governments around the world to achieve policy goals related to health, safety, employment, environmental protection, retirement savings, debt, and more. Yet a critical aspect of these nudge-type policy interventions—the mode of communication—remains unexplored. We study the effects of the communication medium on debt collection procedures, using a policy experiment conducted in cooperation with the Israeli Ministry of Justice. Debtors often lack adequate information about the debt, the judgment, and the enforcement and collection procedures. As a result, the process of debt collection is often harmful to the debtor and ineffective in securing repayment. We manipulate the choice of medium—telephone, regular mail, text message, and video message—holding fixed the content of the communication. We find that digital communication strategies, in particular, communicating via text message, were the most cost-effective, significantly improving outcomes for both debtors and creditors.

Suggested Citation

  • Oren Bar-Gill & Alma Cohen, 2022. "How to Communicate the Nudge: A Real-World Policy Experiment," Journal of Law and Economics, University of Chicago Press, vol. 65(3), pages 607-633.
    • Handle: RePEc:ucp:jlawec:doi:10.1086/718856
    DOI: 10.1086/718856
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