Household Decision Making and Savings Impacts: Further Evidence from a Commitment Savings Product in the Philippines

Nava Ashraf (), Dean Karlan () and Wesley Yin ()
Additional contact information
Nava Ashraf: Harvard Business School
Wesley Yin: University of Chicago

Working Papers from Economic Growth Center, Yale University

Abstract: Commitment devices for savings could benefit those with self-control as well as familial or spousal control issues. We find evidence to support both motivations. We examine the impact of a commitment savings product in the Philippines on household decision making power and self-perception of savings behavior, as well as actual savings. The product leads to more decision making power in the household for women, and likewise more purchases of female-oriented durable goods. We also find that the product leads women who appear time-inconsistent in a baseline survey to self-report being a disciplined saver in the follow-up survey. For impact on savings balances, we find that the 81% increase in savings after one year did not crowd out savings held outside of the participating bank, but that the longer-term impact over two and a half years on bank savings dissipated to only a 33% increase, which is no longer statistically significant. We discuss reasons why the effect dissipated and the implications for designing and implementing sustainable, equilibrium-shifting interventions.

Keywords: Savings; Microfinance; Female empowerment; Household Decision making; Commitment (search for similar items in EconPapers)
JEL-codes: D12 D63 D91 J16 O12 O16 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dev and nep-fmk
Date: 2006-06
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Working Paper: Household Decision making and Savings Impacts: Further Evidence from a Commitment Savings Product in the Philippines (2006)
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Persistent link: http://EconPapers.repec.org/RePEc:egc:wpaper:939

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