Nudging the financial market? A review of the nudge theory

Cynthia Weiyi Cai

doi:10.1111/acfi.12471

Nudging the financial market? A review of the nudge theory

Cynthia Weiyi Cai

Research output: Contribution to journal › Article › peer-review

69 Citations (Scopus)

217 Downloads (Pure)

Abstract

A systematic review of the nudge literature and an examination of its applications across different domains reveals that: (i) a nudge, in the sense of using choice architecture to push people to choose desired results, works well; and (ii) a nudge, in the sense of pushing people to choose desired results so that people will be better off, remains questionable. In financial markets, regulators and financial intermediaries currently use nudge theory to: (i) adjust how investment choices are presented to investors; and (ii) provide information in a selective way. Besides nudging investors, it is also possible for regulators to nudge financial intermediaries towards making more ethical decisions.

Original language	English
Pages (from-to)	3341-3365
Number of pages	25
Journal	Accounting and Finance
Volume	60
Issue number	4
Early online date	28 Mar 2019
DOIs	https://doi.org/10.1111/acfi.12471
Publication status	Published - Dec 2020
Externally published	Yes

Bibliographical note

Copyright © 2019 The Authors. Accounting & Finance published by John Wiley & Sons Australia, Ltd on behalf of Accounting and Finance Association of Australia and New Zealand. Version archived for private and non-commercial use with the permission of the author/s and according to publisher conditions. For further rights please contact the publisher.

Keywords

Financial market
Investment decision-making
Nudge

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10.1111/acfi.12471Licence: CC BY

Publisher version (open access)Final published version, 251 KBLicence: CC BY

Cite this

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Nudging the financial market? A review of the nudge theory

Abstract

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Keywords

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