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Self-Control and Demand for Preventive Health: Evidence from Hypertension in India

Author

Listed:
  • Liang Bai

    (King's College London and University of Edinburgh)

  • Benjamin Handel

    (University of California, Berkeley and NBER)

  • Edward Miguel

    (University of California, Berkeley and NBER)

  • Gautam Rao

    (Harvard University and NBER)

Abstract

Self-control problems constitute a potential explanation for the under-investment in preventive health care observed in low-income countries. A commonly proposed policy tool to solve such problems is offering consumers commitment devices. We conduct a field experiment to evaluate the effectiveness of different types of theoretically-motivated commitment contracts in increasing preventive doctor visits by hypertensive patients in rural India. We document varying levels of takeup of the different commitment contracts, but find no effects on actual doctor visits or individual health outcomes. Thus, a substantial number of individuals pay for commitments, but then fail to follow through on the specified task, losing money without experiencing any health benefit. We develop and structurally estimate a pre-specified model of consumer behavior under present bias with varying levels of naivete. The results are consistent with a large share of individuals being partially naive about their own self-control problems: in other words, they are sophisticated enough to demand some commitment, but overly optimistic about whether a given commitment is sufficiently strong to be effective. The results suggest that commitment devices may in practice be welfare diminishing, at least in some contexts, and serve as a cautionary tale about the role of these contracts in the health care sector.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Liang Bai & Benjamin Handel & Edward Miguel & Gautam Rao, 2021. "Self-Control and Demand for Preventive Health: Evidence from Hypertension in India," The Review of Economics and Statistics, MIT Press, vol. 103(5), pages 835-856, December.
    • Handle: RePEc:tpr:restat:v:103:y:2021:i:5:p:835-856
    DOI: 10.1162/rest_a_00938
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    JEL classification:

    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior

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