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on Nudge and Boosting |
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Issue of 2026–09–28
two papers chosen by Marco Novarese, Università degli Studi del Piemonte Orientale |
| By: | Michael King (Department of Economics, Trinity College Dublin); Paolina Medina (University of Houston); Roland Umanan (Department of Economics, Trinity College Dublin, University of Dublin); Ray Charles Howard (University of Virginia) |
| Abstract: | Cash remains a dominant payment method in many markets despite the widespread availability of digital alternatives such as debit cards, creating costs for consumers, firms, and governments. This research examines which interventions most effectively increase debit‐card use, how effectiveness varies with incentive form and amount, and whether average effects conceal meaningful differences across customers. A large‐scale randomized field experiment with approximately 1.5 million customers of a Mexican bank tests cash and gift‐card incentives of 60 and 300 MXN, repeated benefit‐focused nudges, and combinations of nudges with cash incentives. Estimated treatment effects on debit‐card transaction frequency and spending range from approximately 0% to 5%, with larger incentives producing less‐than‐proportional gains in transaction frequency and incentive‐form effects varying across outcomes and incentive amounts. Causal‐forest estimates show substantial treatment‐effect heterogeneity: for example, the effect of the 300 MXN cash incentive is concentrated among customers with relatively high baseline debit‐card use, while some near‐zero average effects mask offsetting positive and negative subgroup responses. Nudges have small nonsignificant effects alone and no detectable incremental effect when combined with cash incentives. These findings show that effective payment‐activation strategies depend not only on intervention design but also on which customers receive them. |
| Keywords: | Financial Inclusion, Debit Cards, Cash and In-kind Incentives, Nudges, Spillover Effects |
| JEL: | C93 D12 D14 D18 G21 G51 |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:tcd:tcduee:tep1826 |
| By: | Fahd Zulfiqar (Pakistan Institute of Development Economics); Fizzah Khalid Butt (Pakistan Institute of Development Economics); Maryam Hafeez (Pakistan Institute of Development Economics) |
| Abstract: | Globally, public policy debates are focusing the need for behavioral analyses; specifically, the behavioral assessments and evaluations of already-intervened socioeconomic policies, the critical behavioral appraisals of policies before implementation, and testing of behavioral policy research methods and instruments. In Pakistan, these evaluations and assessments are significantly missing from policy formation and implementation processes, which is why the current research has been designed with the intent of theoretical, methodological, and pragmatic significance of aligning policy with behavioral evidence. There are three inter-related sections of the paper; first reviews the theoretical articulation of policy-evidence relationship, second focuses on the nudges needed for behavioral change which can be of use for policy adherence along with global and local case studies as pragmatic examples and the third highlights the methods derived from behavioral, sociological, and anthropological fields of inquiry which are of use for behavioral assessments. The sections cover the theoretical, pragmatic, and methodological components to pin down the fact for evidence-based policy solutions, theory-methods-action nexus needs strengthening. The final section concludes with a few recommendations. |
| Keywords: | Behaviors, Nudge, and Policy |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:pid:wpaper:2026:4 |