Download

Around the world, 152 million children are engaged in child labor. Because poverty is thought to be the root cause of child labor, policymakers have aimed to reduce child labor by improving the economic welfare of poor households where children are engaged in child labor. In the Philippines, researchers partnered with the Philippine Department of Labor and Employment (DOLE) to conduct a randomized evaluation of the impact of a program that provided a one-time productive asset transfer of PHP 10,000 (equivalent to US$518) on economic well-being and child labor outcomes.

Key Findings 

Approximately 15 months after the program started:

  • The assets increased household business activity, both fostering new activities and helping older business activities persist.
  • The program increased food security and improved some measures of child welfare, including children’s life satisfaction.
  • The program had a positive rate of return on family-firm generated income.
  • However, the program also led to an increase in child employment for children who had not worked before.
  • The increase in child employment appears to be driven by the increase in work opportunities brought on by the family businesses.
  • The results support productive asset livelihoods promotion as a poverty alleviation strategy in poor families with child labor present, but cast doubt on the approach as a way to eradicate child labor, at least in this context.
Country:
Program area:
Type:
Brief
Date:
January 07, 2019
Download

Commitment products can remedy self-control problems. However, imperfect knowledge about their preferences may (discontinuously) lead individuals to select into incentive-incompatible commitments, which reduce their welfare. I conduct a field experiment where low-income individuals were randomly offered a new installment-savings commitment account. Individuals chose a personalized savings plan and a default penalty themselves. A majority appears to choose a harmful contract: While the average effect on bank savings is large, 55 percent of clients default, and incur monetary losses. A possible explanation is that the chosen penalties were too low (the commitment was too weak) to overcome clients’ self-control problems. Measures of sophisticated hyperbolic discounting correlate negatively with take-up and default, and positively with penalty choices – consistent with theoretical predictions that partial sophisticates adopt weak commitments and then default, while full sophisticates are more cautious about committing, but better able to choose incentive-compatible contracts.

Authors:
Country:
Program area:
Type:
Published Paper
Date:
October 01, 2018
Download

This third-round report presents short-term output and longer-term impact findings of a nationwide, government-run, community-driven development (CDD) project in the Philippines: Kapit-bisig Laban sa Kahirapan (“Linking Arms Against Poverty”)—Comprehensive and Integrated Delivery of Social Services (Kalahi-CIDSS or KC). These impact findings were generated from a randomized control trial implemented by IPA using data collected between 2011 and 2015. The report focuses on the effects of KC in barangays (villages) across the Philippines’ three main island groupings—Luzon, Mindanao, and Visayas—after approximately three cycles of CDD programming. The findings are presented in three main outcome streams or domains: socioeconomic conditions, governance, and community empowerment. The principal goal of this report is to serve as an independent assessment of the impact of KC generally, and specifically of the returns to the Millennium Challenge Corporation’s (MCC) investment in KC. Simultaneously, the report aims to offer lessons to improve CDD-related policy in the Philippines and beyond, and to contribute to broader research about the impacts of CDD programs.

Country:
Program area:
Type:
Report
Date:
June 22, 2018

To test the causal impact of religiosity, we conducted a randomized evaluation of an evangelical Protestant Christian values and theology education program that consisted of 15 weekly half-hour sessions. We analyze outcomes for 6,276 ultra-poor Filipino households six months after the program ended. We find significant increases in religiosity and income, no significant changes in total labor supply, assets, consumption, food security, or life satisfaction, and a significant decrease in perceived relative economic status. Exploratory analysis suggests the program may have improved hygienic practices and increased household discord, and that the income treatment effect may operate through increasing grit.

Country:
Program area:
Topics:
Type:
Working Paper
Date:
February 19, 2018

A debt trap occurs when someone takes on a high-interest rate loan and is barely able to pay back the interest, and thus perpetually finds themselves in debt (often by re-financing). Studying such practices is important for understanding financial decision-making of households in dire circumstances, and also for setting appropriate consumer protection policies. We conduct a simple experiment in three sites in which we paid off high-interest moneylender debt of individuals. Most borrowers returned to debt within six weeks. One to two years after intervention, treatment individuals were borrowing at the same rate as control households.

Country:
Program area:
Type:
Working Paper
Date:
January 23, 2018
English

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.

Program area:
Type:
Brief
Date:
March 06, 2017

Pages