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Fields Changed

Registration

Field Before After
Study Withdrawn No
Intervention Completion Date June 07, 2018
Data Collection Complete Yes
Final Sample Size: Number of Clusters (Unit of Randomization) 2821 individuals
Was attrition correlated with treatment status? No
Final Sample Size: Total Number of Observations 2821 individuals
Final Sample Size (or Number of Clusters) by Treatment Arms 1410 Simple reminder, 705 Female agent, 706 Male agent
Is there a restricted access data set available on request? No
Program Files No
Data Collection Completion Date July 04, 2018
Is data available for public use? No
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Papers

Field Before After
Paper Abstract This study aims to explore how various nudges that have successfully increased the payment discipline among borrowers with performing loans affect the behavior of the defaulted debtors. In three field experiments involving 32,000 borrowers, debtors were randomly assigned to receive reminders that used personalized language, mentioned economic consequences, and prosocial motives. In one experiment, the design of the envelope varied. The experimental results show that simply nudging defaulted individuals does not work. Although every next reminder that debtors receive increases the payment rate, the effect is rather small. Moreover, sending reminders when the promise to make a payment on a debt has already been made can trigger a repeated default. I also find that a red envelope design backfires on collection efforts. The findings offer a fuller understanding of the behavior of defaulted debtors and suggest policy implications in debt repayment and recovery of non-performing loans.
Paper Citation Saulı̄tis, A. (2023). Nudging debtors with non-performing loans: Evidence from three field experiments. Journal of Behavioral and Experimental Finance, 37, 100776. https://doi.org/10.1016/j.jbef.2022.100776
Paper URL https://doi.org/10.1016/j.jbef.2022.100776
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