Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/340111 
Year of Publication: 
2026
Series/Report no.: 
ZEW Discussion Papers No. 26-014
Publisher: 
ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung, Mannheim
Abstract: 
Default settings strongly increase pension enrollment, especially when savings incentives are high and choices are complex. We show that the effect is weaker when incentives are low, options are simple, and opting out is easy. We study the nationwide introduction of auto-enrollment for low income employees in Germany's public pay-as-you-go pension system. We find that automatic enrollment raises participation by 23 percentage points, though most individuals actively opt out. Linking administrative and survey data shows that the default effect is stronger when enrollment incentives are higher and among individuals who lack knowledge of their enrollment status.
Subjects: 
Default-Setting
Auto-Enrollment
Pensions
Financial Literacy
JEL: 
D14
H55
J26
Document Type: 
Working Paper

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