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Diffusion in social networks: Experimental evidence on information sharing vs persuasion

Author

Listed:
  • Fafchamps, Marcel
  • Islam, Asad
  • Pakrashi, Debayan
  • Tommasi, Denni

Abstract

Human behaviors and innovations often spread through social networks, yet the mechanisms driving this diffusion — information sharing or persuasion — remain debated. Using a large-scale randomized controlled trial in Uttar Pradesh, India, we examine these dynamics while promoting a newly introduced savings commitment product. Our findings reveal persuasion as the dominant channel: villages where persuasion was incentivized experienced significantly higher product sign-up and take-up rates, even without corresponding increases in financial literacy or product knowledge. Conversely, providing information alone had minimal impact. The combined intervention of persuasion and information delivered the highest outcomes, highlighting their complementary roles. These results highlight the critical importance of persuasion in driving behavioral change and suggest that information dissemination alone may often be insufficient for effective adoption and diffusion.

Suggested Citation

  • Fafchamps, Marcel & Islam, Asad & Pakrashi, Debayan & Tommasi, Denni, 2026. "Diffusion in social networks: Experimental evidence on information sharing vs persuasion," Journal of Development Economics, Elsevier, vol. 179(C).
    • Handle: RePEc:eee:deveco:v:179:y:2026:i:c:s0304387825002378
    DOI: 10.1016/j.jdeveco.2025.103686
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    Cited by:

    1. is not listed on IDEAS
    2. Walter, Johannes, 2025. "Using AI Persuasion to Reduce Political Polarization," VfS Annual Conference 2025 (Cologne): Revival of Industrial Policy 325453, Verein für Socialpolitik / German Economic Association.

    More about this item

    Keywords

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    JEL classification:

    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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