The Nollywood Nudge : An Entertaining Approach to Saving

• Published in: IDEAS Working Paper Series from RePEc
• Main Authors: Coville, Aidan, Di Maro, Vincenzo, Dunsch, Felipe Alexander, Zottel, Siegfried
• Format: Paper
• Language: English
• Published: St. Louis Federal Reserve Bank of St. Louis 01.01.2019
• Subjects: Borrowing; Savings accounts

This paper investigates the immediate and medium-term behavioral response to an emotional trigger designed to affect biases in intertemporal financial decisions. The emotional trigger is provided by a narrative portraying the catastrophic consequences of poor financial choices. Even when people are fully aware of the most appropriate action to take, cognitive biases may prevent this knowledge from translating into action. The paper contributes to the literature by directly testing the importance of linking emotional stimulus to financial messages, to influence borrowing and saving decisions, and identifying the interaction between emotional stimulus and the opportunity to act on this stimulus. The study randomly assigned individuals to a featured production -- a Nollywood (the Nigerian Hollywood) movie -- on the financial consequences of poor borrowing and saving behavior. This treatment is interacted with the option of opening a savings account at the screening of the movie. At the exit of the screening, individuals in the financial education movie treatment are more likely to open a savings account than individuals in the placebo movie treatment. However, the effects dissipate quickly. When savings and borrowing behavior is measured four months later, the study finds no differences between treatments. The paper concludes that emotional triggers delivered in the context of a one-time feature film might not be enough to secure sustained changes in behavior.