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Nudging toward a stable retirement

  • Charles Kroncke (a1)

The classical economics perspective is that public policy should be used to allow, not hinder, economic freedom. In some cases it may be possible for government to gently nudge individuals to change their behavior without hindering freedom. One example is a change from the default on pension program enrollment forms from “not contribute” to “contribute.” This is generally viewed as a good nudge that gets people to do what the majority of people view as generally the correct behavior. However, a choice to contribute to a pension fund is not always in the individual’s best interest — thus, it is a nudge, not a mandate. To maintain personal liberty, individuals should be fully informed about the consequences of their choice and the motives of the political authority. Saving for retirement is a complex issue, and pension contribution decisions are often made with little foresight or information. Pension contribution nudges may not always be freedom preserving because of complexity and unintended consequences. The benefits, risks, and limitations of default contribution pension nudges are discussed.

Corresponding author
Correspondence: Charles Kroncke, Department of Business, Mount St. Joseph University, Cincinnati, Ohio. Email:
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1 Sunstein, C. R., The Ethics of Influence: Government in the Age of Behavioral Science (New York: Cambridge University Press, 2016).
2Sunstein, 2016.
3Sunstein, 2016.
4Sunstein, 2016.
5Sunstein, 2016.
6 Beshears, J., Choi, J., Laibson, D., and Madrian, B., “The importance of default options for retirement savings outcomes: Evidence from the United States,” Working Paper 12009 (Cambridge, MA: National Bureau of Economic Research, 2006).
7Sunstein, 2016.
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Politics and the Life Sciences
  • ISSN: 0730-9384
  • EISSN: 1471-5457
  • URL: /core/journals/politics-and-the-life-sciences
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