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Loose Knots: Strong versus Weak Commitments to Save for Education in Uganda

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  • Karlan, Dean

    ()
    (Yale University)

  • Linden, Leigh L.

    ()
    (University of Texas at Austin)

Abstract

Commitment devices offer an opportunity to restrict future choices. However, if severe restrictions deter participation, weaker restrictions may be a more effective means of changing behavior. We test this using a school-based commitment savings device for educational expenses in Uganda. We compare an account fully-committed to educational expenses to an account in which savings are available for cash withdrawal but intended for educational expenses. The weaker commitment generates increased savings in the program accounts and when combined with a parent outreach program, higher expenditures on educational supplies. It also increases scores on an exam covering language and math skills by 0.14 standard deviations. We find no effect for the fully-committed account, and we find no effect for either account on attendance, enrollment, or non-cognitive skills.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 7901.

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Length: 35 pages
Date of creation: Jan 2014
Date of revision:
Handle: RePEc:iza:izadps:dp7901

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Keywords: commitment savings; micro-savings; educational resources; school participation;

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  1. Felipe Barrera-Osorio & Marianne Bertrand & Leigh L. Linden & Francisco Perez-Calle, 2011. "Improving the Design of Conditional Transfer Programs: Evidence from a Randomized Education Experiment in Colombia," American Economic Journal: Applied Economics, American Economic Association, American Economic Association, vol. 3(2), pages 167-95, April.
  2. Nava Ashraf & Dean S. Karlan & Wesley Yin, 2005. "Tying Odysseus to the Mast: Evidence from a Commitment Savings Product in the Philippines," Working Papers, Economic Growth Center, Yale University 917, Economic Growth Center, Yale University.
  3. Avvisati, Francesco & Gurgand, Marc & Guyon, Nina & Maurin, Eric, 2010. "Getting Parents Involved: A Field Experiment in Deprived Schools," CEPR Discussion Papers, C.E.P.R. Discussion Papers 8020, C.E.P.R. Discussion Papers.
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