Working Paper: NBER ID: w17255
Authors: Pascaline Dupas; Jonathan Robinson
Abstract: Using data from a field experiment in Kenya, we document that providing individuals with simple informal savings technologies can substantially increase investment in preventative health and reduce vulnerability to health shocks. Simply providing a safe place to keep money was sufficient to increase health savings, through a mental accounting effect. Adding an earmarking feature was only helpful when funds were put towards emergencies; earmarking for preventative health reduced savings on average, because the liquidity cost of tying up money was too great. Providing social pressure and credit through a ROSCA-based savings scheme had very large effects.
Keywords: savings; health investments; field experiment; developing countries; mental accounting
JEL Codes: D14; D91; O16
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| safe box (D14) | preventative health investments (I14) |
| health pot (I19) | preventative health investments (I14) |
| lockbox (Y60) | preventative health investments (I14) |
| health savings account (HSA) (I13) | likelihood of being unable to afford medical care (I13) |
| present-biased individuals (D91) | need for stronger commitment mechanisms (D47) |
| married women (J12) | benefit from savings technologies (Q55) |