There are massive gaps between low- and high-socioeconomic status (SES) Americans in retirement savings, COVID-19 susceptibility, consumer behaviors, and other domains. This Journal of Marketing study finds that automatic enrollment (defaults) and other nudges reduce gaps like these by impacting low-SES individuals most. For example, many states are considering making voter registration automatic, which could empower low-income, young, and less educated citizens. Many U.S. companies use automatic enrollment to help employees save for retirement. When COVID-19 struck, many employers automatically sent free masks to all employees. Additionally, Congress has considered making earned income tax credits automatic to get much-needed money to all eligible citizens. In this webinar, the authors show how such actions improve welfare overall and reduce inequities by helping the vulnerable most. These findings give decision makers a clear path to cost-effectively reduce SES disparities.
Full Journal of Marketing article: https://doi.org/10.1177/0022242921993186
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