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Social and Financial Incentives for Overcoming a Collective Action Problem

M. Mehrab Bakhtiar, Raymond Guiteras, James Levinsohn and Ahmed Mobarak

No 29294, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Addressing public health externalities often requires community-level collective action. Each person’s sanitation behavior can affect the health of neighbors. We report on a cluster randomized controlled trial conducted with 19,000 households in rural Bangladesh where we randomized (1) either group financial incentives or a non-financial “social recognition” reward, and (2) asking each household to make either a private pledge or a public pledge to maintain hygienic latrines. The group financial reward has the strongest impact in the short term (3 months), inducing a 7.5-12.5 percentage point increase in hygienic latrine ownership. Getting people to publicly commit to maintaining and using a hygienic latrine in front of their neighbors induced a 4.2-6.1 percentage point increase in hygienic latrine ownership in the short term. In the medium term (15 months), the effect of the financial reward dissipates while the effect of the public commitment persists. Neither social recognition nor private commitments produce effects statistically distinguishable from zero.

JEL-codes: O1 Q56 (search for similar items in EconPapers)
Date: 2021-09
New Economics Papers: this item is included in nep-exp and nep-hea
Note: DEV EEE
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Published as M. Mehrab Bakhtiar & Raymond P. Guiteras & James Levinsohn & Ahmed Mushfiq Mobarak, 2023. "Social and financial incentives for overcoming a collective action problem," Journal of Development Economics, .

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