Record Details

Unshrouding: Evidence from Bank Overdrafts in Turkey

Harvard Dataverse (Africa Rice Center, Bioversity International, CCAFS, CIAT, IFPRI, IRRI and WorldFish)

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Title Unshrouding: Evidence from Bank Overdrafts in Turkey
 
Identifier https://doi.org/10.7910/DVN/5CBYG5
 
Creator Alan, Sule
Cemalciclar, Mehmet
Karlan, Dean
Zinman, Jonathan
 
Publisher Harvard Dataverse
 
Description Lower prices produce higher demand… or do they? A bank’s direct marketing to holders of “free” checking accounts show that a large discount on 60% APR overdrafts reduces overdraft usage, especially when bundled with a discount on debit card or auto-debit transactions. In contrast, messages mentioning overdraft availability without mentioning price increase usage. Neither change persists long after messages stop. These results do not square easily with classical models of consumer choice and firm competition. Instead they support behavioral models where consumers both underestimate and are inattentive to overdraft costs, and firms respond by shrouding overdraft prices in equilibrium.
 
Subject Social Sciences
Household finance
Consumer finance
Behavioral finance
Contingent charges
Deceptive advertising
Transaction-linked credit
Small-dollar loans
Consumer banking
Retail banking
Deposit accounts
 
Language English
 
Contributor Research Support, Innovations for Poverty Action
 
Type Administrative data