A Nudge Isn’t Always Enough
The brief’s key findings are:
- Defaults, such as 401(k) auto-enrollment, have encouraged people to adopt behaviors that align with their intentions.
- Researchers have begun to explore what happens when the default may not align with intentions.
- A new experiment tested whether defaults could encourage low-income tax filers to invest about 10 percent of their refunds in U.S. Savings Bonds.
- The default did not work: only 9 percent of the experimental group purchased bonds, no different than the control group.
- The evidence suggests a likely explanation: participants had plans to spend their refunds.