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Are People Systematically Inactive Across Financial Decisions? Linking Evidence from Mortgage and Retirement Saving Decisions

Author

Listed:
  • Henrik Yde Andersen

    (Danmarks Nationalbank)

  • Camilla Skovbo Christensen

    (Department of Economics, University of Copenhagen)

  • Claus Thustrup Kreiner

    (Department of Economics, University of Copenhagen)

  • Soeren Leth-Petersen

    (Department of Economics, University of Copenhagen)

Abstract

Many people forgo substantial economic gains by not responding to financial incentives, even in major decisions such as retirement savings and mortgage refinancing. But do the same people systematically fail to respond across financial contexts? We study this using a quasi-experimental setting that combines policy changes in pension incentives with shifts in mortgage refinancing incentives from interest rate fluctuations. Linking Danish administrative records, we uncover a striking independence between financial decisions: people who are inactive in one context are not systematically inactive in the other. One implication is that the costs of inaction are not concentrated among specific groups.

Suggested Citation

  • Henrik Yde Andersen & Camilla Skovbo Christensen & Claus Thustrup Kreiner & Soeren Leth-Petersen, 2025. "Are People Systematically Inactive Across Financial Decisions? Linking Evidence from Mortgage and Retirement Saving Decisions," CEBI working paper series 25-11, University of Copenhagen. Department of Economics. The Center for Economic Behavior and Inequality (CEBI).
    • Handle: RePEc:kud:kucebi:2511
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    File URL: https://www.econ.ku.dk/cebi/publikationer/working-papers/CEBI_WP_11-25.pdf
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth
    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies

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