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When Incentives Aren't Enough: Evidence on Inattention and Imperfect Memory from HIV Medication Adherence

Author

Listed:
  • Hang Yu
  • Jared Stolove
  • Dean Yang
  • James Riddell IV
  • Arlete Mahumane

Abstract

Financial incentives are widely used to encourage beneficial behaviors, but their effectiveness may be limited by inattention and imperfect memory. We study this in a randomized trial of HIV medication adherence in Mozambique. Financial incentives alone increase adherence by 10.6 percentage points, while pairing incentives with reminders increases adherence by 24.3 percentage points. We develop a model in which inattention to daily adherence and imperfect memory of payment eligibility reduce incentive effectiveness and show that reminders mitigate both frictions. Detailed medication refill data support the model’s predictions. The results suggest combining incentives with reminders can substantially increase program effectiveness.

Suggested Citation

  • Hang Yu & Jared Stolove & Dean Yang & James Riddell IV & Arlete Mahumane, 2026. "When Incentives Aren't Enough: Evidence on Inattention and Imperfect Memory from HIV Medication Adherence," NBER Working Papers 34917, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:34917
    Note: DEV EH
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    More about this item

    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
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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