What Impedes Efficient Adoption of Products? Evidence from Randomized Variation in Sales Offers for Improved Cookstoves in Uganda
AbstractMany people do not purchase products that would appear to benefit them. For example, the price of an efficient cookstove can be less than a few monthsâ€™ savings on fuel. If liquidity constraints, present bias, and poor information on fuel savings and stove durability are barriers, then combining a free trial, time payments, and the right to return the stove at any time should increase sales. In a randomized trial, this offer increases uptake of an efficient charcoal-burning stove in Kampala, Uganda, from 4% to 46%. We provide additional evidence that both liquidity constraints and imperfect information were important barriers.
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Bibliographic InfoPaper provided by Institute of Industrial Relations, UC Berkeley in its series Institute for Research on Labor and Employment, Working Paper Series with number qt7qk8m53w.
Date of creation: 27 Mar 2012
Date of revision:
Social and Behavioral Sciences; JEL C93; D91; L15; L81; M31; D12; D82;
Find related papers by JEL classification:
- C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
- D91 - Microeconomics - - Intertemporal Choice - - - Intertemporal Household Choice; Life Cycle Models and Saving
- L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
- L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
- M31 - Business Administration and Business Economics; Marketing; Accounting - - Marketing and Advertising - - - Marketing
- D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
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- Grossman, Sanford J, 1981. "The Informational Role of Warranties and Private Disclosure about Product Quality," Journal of Law and Economics, University of Chicago Press, vol. 24(3), pages 461-83, December.
- Sridhar Moorthy & Kannan Srinivasan, 1995. "Signaling Quality with a Money-Back Guarantee: The Role of Transaction Costs," Marketing Science, INFORMS, vol. 14(4), pages 442-466.
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