# Evaluating Deliberative Competence: A Simple Method with an Application to Financial Choice

Authors: Sandro Ambuehl; B. Douglas Bernheim; Annamaria Lusardi
Venue: American Economic Review, 2022, 112(11): 3584-3626
Year: 2022
Source: https://www.aeaweb.org/articles?id=10.1257/aer.20210290
PDF: https://sandroambuehl.com/assets/papers/evaluating-deliberative-competence.pdf
Plain text version: https://sandroambuehl.com/assets/plain-text/evaluating-deliberative-competence.tex
LaTeX source bundle: https://sandroambuehl.com/assets/plain-text/evaluating-deliberative-competence.tex
Appendix: https://sandroambuehl.com/assets/papers/evaluating-deliberative-competence-appendix.pdf
Replication package: https://doi.org/10.3886/E171681V1

## Abstract

We examine methods for evaluating interventions designed to improve decision-making quality when people misunderstand the consequences of their choices. In an experiment involving financial education, conventional outcome metrics imply that two interventions are equally beneficial even though only one reduces the average severity of errors. We trace these failures to violations of the assumptions embedded in the conventional metrics.
We propose a simple, intuitive, and broadly applicable outcome metric that properly differentiates between the interventions, and is robustly interpretable as a measure of welfare loss from misunderstanding consequences even when additional biases distort choices.

## Additional Links

- Replication report: https://www.rwi-essen.de/fileadmin/user_upload/RWI/Publikationen/I4R_Discussion_Paper_Series/110_I4R_Dao_Fenig_Sator_Yoon.pdf
- Media - Financial Times: https://www.ft.com/content/e6a77a5c-70cb-11e4-9129-00144feabdc0