IDEAS home Printed from https://ideas.repec.org/a/ucp/ecdecc/doi10.1086-705681.html
   My bibliography  Save this article

Leveraging the Lottery for Financial Inclusion: Lotto-Linked Savings Accounts in Haiti

Author

Listed:
  • Felipe Dizon
  • Travis J. Lybbert

Abstract

Many poor Haitians are more familiar with lottery wagers than any other financial transaction and lack access to savings products. Using a lab-in-field experiment in Haiti, we test a prototype lotto-linked savings (LLS) product that returns lotto credit in lieu of interest. We find that LLS increased total savings by 22%, nearly twice the savings increase induced by raising the interest rate from 5% to 20%. The presence, rather than the extent, of the lotto component seems to drive this savings response most. The LLS-induced increase in savings was financed by reductions in lotto spending and traditional savings and smaller reductions in consumption. These reallocations increased subjects’ overall expected returns in the experiment. Those who allocated more to the lottery before LLS and who overweight small probabilities increased savings most in response to LLS.

Suggested Citation

  • Felipe Dizon & Travis J. Lybbert, 2021. "Leveraging the Lottery for Financial Inclusion: Lotto-Linked Savings Accounts in Haiti," Economic Development and Cultural Change, University of Chicago Press, vol. 69(4), pages 1323-1349.
    • Handle: RePEc:ucp:ecdecc:doi:10.1086/705681
    DOI: 10.1086/705681
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1086/705681
    Download Restriction: Access to the online full text or PDF requires a subscription.
    File URL: http://dx.doi.org/10.1086/705681
    Download Restriction: Access to the online full text or PDF requires a subscription.
    File URL: https://libkey.io/10.1086/705681?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Dizon, Felipe & Yu, Jisang, 2021. "Nudges versus subsidies: Experimental evidence on the demand for a nutritious food in India," Journal of Economic Behavior & Organization, Elsevier, vol. 191(C), pages 1091-1111.
    2. Jindapon, Paan & Sujarittanonta, Pacharasut & Viriyavipart, Ajalavat, 2022. "Prize-linked savings games: Theory and experiment," Games and Economic Behavior, Elsevier, vol. 133(C), pages 202-229.
    3. Shawn Cole & Benjamin Iverson & Peter Tufano, 2022. "Can Gambling Increase Savings? Empirical Evidence on Prize-Linked Savings Accounts," Management Science, INFORMS, vol. 68(5), pages 3282-3308, May.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ucp:ecdecc:doi:10.1086/705681. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Journals Division (email available below). General contact details of provider: https://www.journals.uchicago.edu/EDCC .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.