Seminar: Do nudge effects persist after feedback? Evidence from two changes in the student loan choice architecture
Tuesday April 10th 2018 Marc van der Steeg (OCW) will give a presentation titled 'Do nudge effects persist after feedback? Evidence from two changes in the student loan choice architecture' *Derk Visser† Marc van der Steeg‡ Adam S. Booij§
Not much is known about the persistence of nudge effects in contexts where individuals can adjust their decision after feedback. This paper analyses two such contexts in the realm of
student loans. In one context, the default borrowing amount for students whose entitlement to the performance-related education grants has expired, is significantly reduced due to a
policy change. This leads to a substantial immediate drop in borrowing of 72% in the short run that largely fades to 22% after one year. In the other context, a maximum loan check
box is removed from the online borrowing application form. This leads to an immediate drop of 9% in borrowing amongst new borrowers that largely persists over time. Our set
of results suggest that nudges affecting an active choice have more persistent effects than nudges affecting a passive choice because more people adjust their choice over
time in the latter case. We find no evidence for changes in study success in response to lower borrowing.
†Erasmus School of Economics. whdvisser@gmail.com
‡OCW Dutch ministry of education. marc.vandersteeg@minocw.nl
§University of Amsterdam, Tinbergen Institute. adam.booij@uva.nl
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