We test whether the provision of multiple labeled savings accounts affects savings decisions and downstream outcomes in a field experiment with 481 entrepreneurs in urban Malawi. Treatment respondents received either one or multiple savings boxes, while a control group received nothing. Multiple accounts increased savings in treatment accounts by about 30%. Savings boxes had sizeable effects on a number of outcomes, including farming decisions, household expenditures, land purchases, credit extended to customers, and interpersonal transfers. However, we find no evidence that multiple accounts had larger downstream effects than single accounts.
Designers and funders of payments for ecosystem services (PES) programs have long worried that payments flow to landholders who would have conserved forests even without the program, undermining the environmental benefits (“additionality”) and cost-effectiveness of PES. If landholders self-select into PES programs based on how much conservation they were going to undertake anyway, then those who were planning to conserve should always enroll. This paper discusses the less-appreciated fact that enrollment is often based on other factors too. The hassle of signing up or financial costs of enrollment (e.g., purchasing seedlings) can affect who participates in a PES program. These enrollment costs reduce overall take-up, and, importantly, they can also influence the composition of landholders who select into the program—and thereby the program’s environmental benefits per enrollee. Enrollment costs can increase a program’s benefits per enrollee if they are systematically higher for (and thus deter enrollment by) landholders who would have conserved anyway. Alternatively, enrollment costs can dampen per-enrollee benefits if their correlation with status-quo conservation is in the opposite direction. We illustrate these points with evidence from two studies of randomized trials of PES programs aimed at increasing forest cover in Uganda and Malawi. We also discuss how in other sectors, such as social welfare, policy designers have purposefully adjusted the costs of program enrollment to influence the composition of participants and improve cost-effectiveness. We propose that these ideas for targeting could be incorporated into the design of PES programs.
We use a field experiment to show referral-based hiring has the potential to disadvantage qualified women, highlighting another potential channel behind gender disparities in the labor market. Through a recruitment drive for a firm in Malawi, we look at men's and women's referral choices under different incentives and constraints. We find that men systematically refer few women, despite being able to refer qualified women when explicitly asked for female candidates. Performance pay also did not alter men's tendencies to refer men. Additionally, women did not refer enough high quality women to offset men's behavior.
Research shows that when people participate in the financial system, they are better able to manage risk, start or invest in a business, and fund large expenditures like education or a home improvement. Increasing women’s financial inclusion is especially important as women disproportionately experience poverty, stemming from unequal divisions of labor and a lack of control over economic resources. While demand and supply side barriers to women’s financial inclusion remain, this review shows that appropriate financial product design can help overcome some of these barriers. This review is organized by product and presents the existing evidence on the impact of savings, credit, payments, and insurance products on women’s economic empowerment outcomes, as well as the remaining open research questions in each area. The studies included in this review are limited to those designed as randomized control trials (RCTs), widely considered to be the gold standard in impact evaluation methodology.
We experimentally test the impact of expanding access to basic bank accounts in Uganda, Malawi, and Chile. Over two years, 17 percent, 10 percent, and 3 percent of treatment individuals made five or more deposits, respectively. Average monthly deposits for them were at the 79th, 91st, and 96th percentiles of baseline savings. Survey data show no clearly discernible intention–to–treat effects on savings or any downstream outcomes. This suggests that policies merely focused on expanding access to basic accounts are unlikely to improve welfare noticeably since impacts, even if present, are likely small and diverse.
Financial products and transfer schemes are often designed to help individuals improve welfare by following through on intertemporal plans. This paper implements an artefactual field experiment in Malawi to test the ability of households to manage a cash windfall. This study varies whether 474 households receive a payment in cash or through direct deposit into pre-established accounts at a local bank. Payments are made immediately, with one day delay, or with eight days delay. Defaulting the payments into savings accounts leads to higher bank account balances, an effect that persists for several weeks. However, neither savings defaults nor payment delays affect the amount or composition of spending, suggesting that households manage cash effectively without the use of formal financial products.