How Important are Investment Indivisibilities for Development?

Last registered on June 21, 2017

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Pre-Trial

Trial Information

General Information

Title

Unlocking the Black Box of Savings

RCT ID

AEARCTR-0002217

Initial registration date

June 20, 2017

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published

June 21, 2017, 12:50 PM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Locations

Country

Uganda

Region

Ntungamo, Ibanda, Kagadi

Primary Investigator

Name

Molly Lipscomb

Affiliation

University of Virginia

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Other Primary Investigator(s)

PI Name

Virgiliu Midrigan

PI Affiliation

NYU

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PI Name

Joseph Kaboski

PI Affiliation

University of Notre Dame

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Additional Trial Information

Status

On going

Start date

2015-09-19

End date

2017-09-01

Keywords

Finance & Microfinance

Additional Keywords

JEL code(s)

Secondary IDs

Abstract

We estimate the extent to which low savings rates for many individuals can be explained by high returns to capital in their businesses or in businesses they would like to start. We also estimate the correlation between risk aversion and precautionary savings. In addition, we estimate the extent to which business owners may be more risk loving when they have a target good that they would like to purchase, because they have less use for intermediate levels of funds. We estimate the returns to capital for households of different risk aversion levels and with different patience levels, and combine this with information on their savings rates and borrowing rates at baseline.

External Link(s)

Registration Citation

Citation

Kaboski, Joseph, Molly Lipscomb and Virgiliu Midrigan. 2017. "Unlocking the Black Box of Savings." AEA RCT Registry. June 21. https://doi.org/10.1257/rct.2217-1.0

Former Citation

Kaboski, Joseph, Molly Lipscomb and Virgiliu Midrigan. 2017. "Unlocking the Black Box of Savings." AEA RCT Registry. June 21. https://www.socialscienceregistry.org/trials/2217/history/18845

Sponsors & Partners

Experimental Details

Interventions

Intervention(s)

The intervention will allow households to choose between lotteries which randomize cash grants of varying size ($2 or $100 and $2 or $500) via mobile money to a primarily unbanked population in rural western Uganda. Returns to the cash grants will be calculated at endline.

Intervention Start Date

2017-03-13

Intervention End Date

2017-09-01

Primary Outcomes

Primary Outcomes (end points)

Outcomes: (1) investment, (2) savings, (3) household income and labor provision, (4) household welfare, and (5) use of/engagement in financial services (see below for more detailed description of outcome construction)

Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)

Secondary Outcomes (explanation)

Experimental Design

This study uses a randomized controlled trial design to understand how households react to an unanticipated (positive) shock to their wealth and how this relates to their time preferences and risk preferences. Households are given a choice between a lottery with a fixed probability of getting $100, or a smaller probability of getting $500. Moreover, they are given a choice between receiving the transfer tomorrow or receiving a somewhat larger amount one month later.

Experimental Design Details

Randomization Method

Computerized randomization via algorithm in survey software, done in real-time during the cash grant lottery

Randomization Unit

participant level

Was the treatment clustered?

Experiment Characteristics

Sample size: planned number of clusters

1,048 households

Sample size: planned number of observations

1,048 households

Sample size (or number of clusters) by treatment arms

590 control households, 373 small ($100) grants, 85 large ($500) grants

Minimum detectable effect size for main outcomes (accounting for sample design and clustering)

Supporting Documents and Materials

IRB

Institutional Review Boards (IRBs)

IRB Name

University of Notre Dame

IRB Approval Date

2017-03-06

IRB Approval Number

12-04-306

Analysis Plan

Post-Trial

Post Trial Information

Study Withdrawal

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Intervention

Is the intervention completed?

Data Collection Complete

Data Publication

Is public data available?

Program Files

Reports, Papers & Other Materials