Historically,participation in employer-sponsored retirement saving programs has been characterized by "opt in;" eligible employees go to the company's Human Resources office and fill out a form so that they can start having deductions from their paycheck go into a retirement savings account.Recently,many companies have switched to an "opt out" model for their retirement plans: eligible workers are automatically enrolled in the plan and have to go to their Human Resources office and fill out a form if they do not want to participate in the plan.This change in how employees enroll in retirement savings programs at their employer is an example of ________.

Question

Quizplus · Accepted Answer

The change from an "opt in" to an "opt out" model for retirement savings programs is an example of a nudge. This term refers to using small changes in the way choices are presented or structured to encourage certain behaviors. In this case, automatically enrolling employees in the retirement plan nudges them towards saving for retirement without requiring them to actively choose to do so.

Historically,participation in Employer-Sponsored Retirement Saving Programs Has Been Characterized by "Opt