“Know Your Status”: The Impact of HIV testing on Time and Risk Preferences and the Implications for Behaviour

It has been suggested that voluntary counselling and testing (VCT) may help to reduce the transmission of HIV. Although evidence in support of this claim is mixed, little is known about the channels through which VCT may affect sexual decision-making. The purpose of this study is to test whether learning one’s HIV status has an impact on risky sexual behaviour through the channel of time and risk preferences. Using data from the Malawi Longitudinal Study of Families and Health (MLSFH), the impact of learning HIV results on these preferences, two years ex post, is measured. Secondly, the role of VCT and time and risk preferences in explaining risky sexual behaviour is analysed. Potential endogeneity problems associated with self-selection into learning results and reverse causality between learning results and preferences are overcome by use of an IV strategy. Randomly assigned vouchers to collect results as well as distance to VCT centres are used as instrumental variables for VCT attendance. Difference-in-difference methodology is used to test robustness of the results. Findings indicate little evidence of an enduring impact of VCT on time and risk preferences and risky sexual behaviour. Furthermore, results suggest that preferences are, on average, not a channel through which VCT affects behaviour. Thus, although VCT may affect sexual decision-making in the short-run, as found in some previous studies, such effects may significantly diminish over time and are likely not via the channel of altered preferences for time and risk.