We found a match
Your institution may have access to this item. Find your institution then sign in to continue.
- Title
Side Effects of Nudging: Evidence from a Randomized Intervention in the Credit Card Market.
- Authors
Medina, Paolina C
- Abstract
This paper studies the direct and indirect effects of nudging, by means of a field experiment with a financial management platform in Brazil. Reminders for upcoming credit card payments reduced credit card late-payment fees by 14%, but increased overdraft fees in checking accounts by 9%. The unintended effect is concentrated in users with a history of overdraft use. These users experienced a net increase of 5% in total fees, while the rest experienced savings of 15%. The results provide clear insights for nudge design: like any policy action, nudges can have side effects, and one size may not fit all.
- Subjects
NUDGE theory; CREDIT card industry; ECONOMICS field work; FINANCIAL management; LATE payment; OVERDRAFTS; CREDIT card fees
- Publication
Review of Financial Studies, 2021, Vol 34, Issue 5, p2580
- ISSN
0893-9454
- Publication type
Article
- DOI
10.1093/rfs/hhaa108