This chapter explores the psychology of disclosure, as a nudging instrument, in the context of advised financial investment decisions. It investigates how information about the financial advisor’s potential conflict of interest impacts on the participants’ judgement, whether as to attitudes or actions. Contrary to what is commonly suggested, problems of conflict of interest in the financial investment context may efficiently be treated by means of disclosures, provided that such disclosures explicit the consequences of the conflict for the decision maker. It remains to analyse how explanatory disclosures can be drafted so that their influence on the trust in the advice also translates into modified action.
HELLERINGER, G. (2016). Possibilities, Limitations and Applications in European Law and Economics - Designing Disclosures: Testing the Efficacy of Disclosure in Retail Investment Advice. In: Nudging - Possibilities, Limitations and Applications in European Law and Economics. 1st ed. Springer, pp. 153-167.