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Household Decision Making and Savings Impacts: Further Evidence from a Commitment Savings Product in the Philippines

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  • Ashraf, Nava
  • Karlan, Dean S.
  • Yin, Wesley

Abstract

Commitment devices for savings could benefit those with self-control as well as familial or spousal control issues. We find evidence to support both motivations. We examine the impact of a commitment savings product in the Philippines on household decision making power and self-perception of savings behavior, as well as actual savings. The product leads to more decision making power in the household for women, and likewise more purchases of female-oriented durable goods. We also find that the product leads women who appear time-inconsistent in a baseline survey to self-report being a disciplined saver in the follow-up survey. For impact on savings balances, we find that the 81% increase in savings after one year did not crowd out savings held outside of the participating bank, but that the longer-term impact over two and a half years on bank savings dissipated to only a 33% increase, which is no longer statistically significant. We discuss reasons why the effect dissipated and the implications for designing and implementing sustainable, equilibrium-shifting interventions.

Suggested Citation

  • Ashraf, Nava & Karlan, Dean S. & Yin, Wesley, 2006. "Household Decision Making and Savings Impacts: Further Evidence from a Commitment Savings Product in the Philippines," Center Discussion Papers 28399, Yale University, Economic Growth Center.
  • Handle: RePEc:ags:yaleeg:28399
    DOI: 10.22004/ag.econ.28399
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    File URL: http://ageconsearch.umn.edu/record/28399/files/dp060939.pdf
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    Keywords

    Consumer/Household Economics;

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