000293930 001__ 293930 000293930 005__ 20250213113256.0 000293930 0247_ $$2doi$$a10.71609/iheid-m423-1642 000293930 037__ $$aBOOK 000293930 245__ $$aSaving by default: evidence from a field experiment in Rural India 000293930 260__ $$aGeneva$$bThe Graduate Institute of International and Development Studies$$c2016 000293930 269__ $$a2016 000293930 300__ $$a58 p. 000293930 336__ $$aPapers and Reports 000293930 490__ $$aGraduate Institute of International and Development Studies Working Paper ; no. 02/2016 000293930 520__ $$aWorldwide, people are gaining access to a formal bank account, which allows account-based instead of cash payments. Based on a novel randomized control trial, we document that the payment method is an important determinant of savings behavior. In rural India, we study the effect on savings of allocating identical weekly payments on a bank account (treated) or in cash (control). The treatment impact is huge: savings increase by 110% within three months, and the effect is long-lasting. Villagers paid in cash do not save more in other assets, but increase consumption. Therefore, we infer that being paid on a bank account has a net positive impact on total savings. When we twist the design and start paying everyone in cash, savings and consumption patterns no longer differ between the treated and control. We interpret these findings as the outcome of the default option, and shed light on six plausible underlying mechanisms. 000293930 700__ $$aSomville, Vincent 000293930 700__ $$aVandewalle, Lore 000293930 8564_ $$92cbcb77b-a395-487a-bdf3-d361749587c3$$s1489661$$uhttps://repository.graduateinstitute.ch/record/293930/files/HEIDWP02-2016.pdf 000293930 901__ $$uInternational Economics Department$$0319285 000293930 901__ $$uCentre for Finance and Development 000293930 909CO $$ooai:repository.graduateinstitute.ch:293930$$pIHEID:Infonet$$pGLOBAL_SET$$pIHEID:Infonet_CFD$$pIHEID:Infonet_CTEI$$pIHEID:Infonet_CCDP$$pIHEID:Explore$$pIHEID:Infonet_IE 000293930 937__ $$aWP-2016-043 000293930 980__ $$aINFONET 000293930 980__ $$aWP