Better Strategies for Saving More: Evidence from Three Interventions in Chile

Produced by: 
Universidad de Chile
Available from: 
April 2023
Paper author(s): 
Abhijit Banerjee
Claudia Martínez A.
Esteban Puentes
Poverty - Inequality - Aid Effectiveness

Individual behavioral biases can affect savings behavior. We conduct an experiment to evaluate different strategies to increase savings. We compare an automatic savings plan (or default rule), monthly reminders, and a rule-of-thumb savings package that appeals to careful spending. We find that rule-of-thumb and default rules can increase savings for one year after the intervention. In contrast, reminders can reduce account balances and debt levels. The increase in savings under the default rule is produced by a (mechanical) increase in deposits, but savings is later decreased by an increase in withdrawals.


Research section: 
Latest Research
Share this