Exploiting Moral Wiggle Room in Sustainable Investing

Last registered on April 28, 2021


Trial Information

General Information

Exploiting Moral Wiggle Room in Sustainable Investing
Initial registration date
April 27, 2021

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
April 28, 2021, 10:30 AM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.


Primary Investigator

SFI - University of Zurich

Other Primary Investigator(s)

PI Affiliation
Maastricht University
PI Affiliation
Maastricht University
PI Affiliation
Maastricht University

Additional Trial Information

On going
Start date
End date
Secondary IDs
People often behave prosocially with significant costs to themselves. Yet, people behave more self-interestedly when presented with an opportunity to sneak out of prosocial behavior that prevents them from appearing selfish (Dana, Weber, and Kuang 2007). This tendency to “exploit moral wiggle room” is consistent with the idea that individuals desire to pursue self-interest while maintaining the illusion of behaving prosocially. The primary goal of this project is to study investors’ tendency to exploit moral wiggle room in actual high-stake investment choices. Our hypothesis is that investors use moral wiggle room to avoid sustainable investments. We design and conduct an online experiment among members of a UK pension fund to test this hypothesis.
External Link(s)

Registration Citation

Bauer, Rob et al. 2021. "Exploiting Moral Wiggle Room in Sustainable Investing ." AEA RCT Registry. April 28. https://doi.org/10.1257/rct.7611-1.0
Sponsors & Partners

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Experimental Details


Intervention Start Date
Intervention End Date

Primary Outcomes

Primary Outcomes (end points)
The probability of investing in a sustainable fund (Invest Sust Fund)
The probability of choosing the default option (Used Default)
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
The amount invested in the sustainable fund (Assets Sust Fund)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
Subjects are endowed with an initial sum of money, £1,000 (approx. $1,350), which they are asked to invest. Their task is to allocate the money between two funds. Both funds have a similar profile, being diversified UK investment funds. However, one fund is a conventional investment fund and the other one is a sustainable investment fund. The sustainable option integrates environmental, social, and governance (ESG) factors in its asset allocation. Importantly, the costs of the two funds are different. The conventional fund costs 0.5% of the invested sum. The sustainable fund is more expensive, costing 1.5% of the invested sum.
Experimental Design Details
The experiment starts with an explanation of the setup and the investment options. In a second step, we introduce moral wiggle room for the treatment group in the form of the default option. We introduce an additional screen where we ask participants if, for an additional fee of 0.2%, they want to select a default option instead of allocating the investment across the two funds by themselves. They can click on a “choose funds myself” button that leads them to the fund selection screen. At this stage, they can arbitrarily split the £1,000 between the conventional and sustainable fund.
The conventional investment fund is a passive tracker of the MSCI UK index, and the sustainable investment fund tracks the MSCI UK SRI index. On the decision screen, the fees are re-iterated. Note that choosing the default option is always suboptimal from a return maximization perspective. The default buys investors exposure to the same fund they can also choose themselves, albeit at a higher cost.
We employ lottery incentives. The participants were informed that the researchers will invest in the actual funds according to the allocation decisions made by five randomly selected survey participants. Six months after the survey is conducted, the five selected participants will receive a payment of £50 plus or minus the returns of their investment net of fees. Moreover, we also incentivize participation in the survey by handing out £50 to five additional participants that are randomly selected.
Randomization Method
Randomization was done by Jigsaw, a survey provider
Randomization Unit
Clustered randomization: Participants are randomly assigned to one of three conditions: Wiggle Room Condition, Sustainable Default Condition, and control (No Default Condition)
Was the treatment clustered?

Experiment Characteristics

Sample size: planned number of clusters
3 Conditions
Sample size: planned number of observations
3,800 participants evenly split between the 3 clusters
Sample size (or number of clusters) by treatment arms
1,266 participants per cluster
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)

Institutional Review Boards (IRBs)

IRB Name
Ethical Review Committee Inner City Faculties (ERCIC) of Maastricht University
IRB Approval Date
IRB Approval Number
Analysis Plan

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Post Trial Information

Study Withdrawal

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Is the intervention completed?
Data Collection Complete
Data Publication

Data Publication

Is public data available?

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials