Scarcity at the End of the Month: First Results from a Field Experiment in Bangladesh

Emily Breza (), Martin Kanz () and Leora Klapper

Working Papers from eSocialSciences

Abstract: This paper reports results of a ?eld experiment designed to test how the timing of wage payments a?ects consumption and ?nancial behaviors. Salaried employees in a large manufacturing ?rm were paid a bonus equal to approximately 10-15% of their monthly wage. While the amount of the bonus was held constant across all workers, the experiment randomly varied its timing: in a treatment group, workers received the bonus one week before the regular payday – the time when they are most likely to experience ?nancial constraints. In a control group, workers receive the pre-announced bonus on the ?rm’s regular payday.

Keywords: Electronic Wage Payments; Savings; Consumption smoothing; Bangaldesh; bonus; regular; financial constraints; firm (search for similar items in EconPapers)
Date: 2017-08
Note: Institutional Papers
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