Impact of disclosing nudges in a financial context

Abstract

Nudges are subject to substantial literature debate due to their subtle nature, as they manipulate individuals’ decisions in a non-transparent way. Therefore, making a nudge transparent might alter its effectiveness.This study was designed to ascertain what is the impact of disclosing nudges in a financial context, particularly in a saving scenario, and how it affected saving contributions, trust towards the bank, and customer/bank relationship for both type 1 and type 2 nudges. A survey was conducted among 613 participants. Overall, respondents did not change their saving contribution, and trust and relationship were not significantly damaged, suggesting that financial nudges can be transparent and effective, similarly to what was found in other fields. The type of nudge used does not significantly influence the saving contribution, nor trust. Nonetheless, the relationship with the bank presented more sensitive results upon nudge disclosure. The factors that influence the saving contribution, trust, and relationship were investigated and the bank’s perceived intention with the nudge strategy was the most relevant aspect.

Date of Award	27 Jan 2021
Original language	English
Awarding Institution	Universidade Católica Portuguesa
Supervisor	Daniel Fernandes (Supervisor)