Large debt burdens are a significant threat to financial stability for many households. Innovations for Poverty Action worked with researchers to evaluate whether prize-linked incentives can help borrowers reduce their debt burdens more effectively. A randomly selected group of borrowers on debt repayment plans were offered entry into a program that turns on-time debt repayments into entries in a lottery.

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Many Americans have accumulated staggering debt loads, limiting their ability to achieve financial stability. While some nonprofit and financial institutions have programs designed to help borrowers repay and reduce debt with personalized debt management plans, many people drop out of these programs in the first year.

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Teacher experience is a key factor in student learning, but many schools in the United States experience high rates of teacher turnover—especially schools serving low-income communities. One reason that retention may be low in these schools is that student loan debt is a significant burden for teachers. As a result, federal loan forgiveness programs may be an effective way of retaining teachers, but many teachers do not take advantage of these programs.

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While many low-income Americans have costly debt, they typically spend only a small proportion of their tax rebates to repay those debts. In partnership with Baltimore CASH, researchers are introducing postcards that encourage low-income tax filers to use their tax rebates to pay off debt, and varying the timing of postcard delivery, to evaluate the impact of these nudges on debt repayment.

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Many financial products such as 401k plans have been designed to help U.S. consumers overcome limited self-control and limited attention in order to reach their savings goals.

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Close to 450,000 people in the U.S. die prematurely each year from smoking-related causes and annual losses in productivity due to smoking-related morbidity top US$96 billion. While many programs exist to help people quit smoking, many have only been effective in the short term. This study will examine whether a combination of positive and negative commitment devices can induce long-term smoking cessation in smokers from a low-to-moderate income background in Connecticut.

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Researchers used two experiments to identify whether the motive for giving in public can be primarily linked to a desire for prestige (the “image” effect) or a hope that a public gift will influence others (the “signal” effect). They found that a desire to improve social image largely explained why public recognition of contributions to charitable organizations increased individual donations in the United States.

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Credit-building loan products (CBLs) have begun to proliferate in the U.S. marketplace, but there is little evidence on the effects of these products on consumers and lenders. IPA and RAND worked with researchers to evaluate the impacts of a CBL offered at a credit union in Missouri, both alone and coupled with financial education.

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Researchers conducted a randomized evaluation to investigate the demand for commitment savings products or financial counseling, and the impacts these products and services have on savings, among a sample of low- and moderate-income credit union members in New York City. Analysis of the effect of these financial products on savings, borrowing, and credit scores is ongoing.

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Americans who have difficulty formally accessing credit from conventional financial institutions often turn to costly products such as high-interest pawn and payday loans or bank account overdrafts. Researchers in this study have partnered with a community development credit union to evaluate the demand for safe, affordable, and transparent small dollar loans, and the impact of behaviorally-informed product features on the financial capability of credit union members.

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There are growing concerns that American households tend to borrow too much and save too little, making it hard to meet basic needs, build assets, prepare for retirement, and pay for emergency expenses. Large debt burdens may compromise individuals and families’ ability to create a safety net or make investments for the future.

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People give to charity for different and multiple reasons. Understanding why people donate may help organizations improve their messaging to potential donors, increase their revenue, and conduct additional programming to achieve their mission. Researchers examined whether individuals gave more after receiving information about a charity’s impact.
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In the United States, private giving to charitable causes has grown significantly in the past several decades. Among the tactics commonly used to solicit donations are matching gifts. This study explored the importance of price on charitable giving by randomly varying the rates of matching gifts and measuring the subsequent effect on donations.

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Researchers designed and piloted a program called Borrow Less Tomorrow (BoLT) that took a behavioral approach to debt reduction, combining an accelerated loan repayment schedule with peer support and reminders. Results from a sample of free tax-preparation clients in Tulsa, United States suggest a strong demand for debt reduction: 41 percent of those offered BoLT used it to make a plan to accelerate debt repayment.

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