The Impact of Finance on Willingness to Pay for Low-Cost Latrines in Rural Cambodia: Evidence from a Randomized-Controlled Trial

Last registered on February 08, 2017
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Pre-Trial

Trial Information

General Information

Title
The Impact of Finance on Willingness to Pay for Low-Cost Latrines in Rural Cambodia: Evidence from a Randomized-Controlled Trial
RCT ID
AEARCTR-0000037
Initial registration date
July 30, 2013

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
July 30, 2013, 5:30 PM EDT

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

Last updated
February 08, 2017, 3:52 PM EST

Last updated is the most recent time when changes to the trial's registration were published.

Locations

Country
Cambodia
Region

Primary Investigator

Name
Raymond Guiteras
Affiliation
Dept. of Agricultural and Resource Economics, North Carolina State University
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Other Primary Investigator(s)

PI Name
Ariel BenYishay
PI Affiliation
University of New South Wales
Contact Investigator
PI Name
Giordano Palloni
PI Affiliation
Dept. of Economics, University of Maryland
Contact Investigator

Additional Trial Information

Status
Completed
Start date
2013-01-01
End date
2014-01-31
Keywords
Environment & Energy, Finance & Microfinance, Health
Additional Keywords
Sanitation, Becker-DeGroot-Marschak mechanism
JEL code(s)
D14, G21, H23, I15, O13, O16, Q56
Secondary IDs
Abstract
The primary goals of this study are: (1) to measure the effect of access to finance on willingness to pay (WTP) for sanitary latrines among residents of rural Cambodia; (2) to determine whether this effect is particularly important for the poor. The design is a cluster-randomized trial: from a sample of 30 representative villages (1,383 households, stratified by IDPoor status) of Kampong Thom province, 15 villages were assigned to a financing arm, while 15 villages were controls. Residents in both treatments were offered an opportunity to purchase a low-cost, sanitary latrine. Residents of financing villages were offered a 12-month loan, while residents of control villages were required to pay cash on delivery. The sale was conducted using the Becker-DeGroot-Marschak mechanism, allowing direct observation of WTP.
External Link(s)

Registration Citation

Citation
BenYishay, Ariel, Raymond Guiteras and Giordano Palloni. 2017. "The Impact of Finance on Willingness to Pay for Low-Cost Latrines in Rural Cambodia: Evidence from a Randomized-Controlled Trial." AEA RCT Registry. February 08. https://doi.org/10.1257/rct.37-2.0
Former Citation
BenYishay, Ariel, Raymond Guiteras and Giordano Palloni. 2017. "The Impact of Finance on Willingness to Pay for Low-Cost Latrines in Rural Cambodia: Evidence from a Randomized-Controlled Trial." AEA RCT Registry. February 08. https://www.socialscienceregistry.org/trials/37/history/13867
Sponsors & Partners

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Experimental Details

Interventions

Intervention(s)
See Pre-Analysis Plan.
Intervention Start Date
2013-01-01
Intervention End Date
2013-03-31

Primary Outcomes

Primary Outcomes (end points)
Willingness to pay for sanitary latrines, by IDPoor and non-IDPoor status; latrine coverage at various prices / subsidy amounts, by IDPoor and non-IDPoor status
Primary Outcomes (explanation)
See Pre-Analysis Plan.

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
See Pre-Analysis Plan.
Experimental Design Details
See Pre-Analysis Plan.
Randomization Method
Randomization in office on Stata.
Randomization Unit
Village
Was the treatment clustered?
Yes

Experiment Characteristics

Sample size: planned number of clusters
30 villages
Sample size: planned number of observations
1,400 households
Sample size (or number of clusters) by treatment arms
15 treatment (financing) villages; 15 control (cash-on-delivery) villages.
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
Supporting Documents and Materials

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IRB

Institutional Review Boards (IRBs)

IRB Name
National Ethics Committee for Health Research, Ministry of Health, Kingdom of Cambodia
IRB Approval Date
2012-04-12
IRB Approval Number
None.
Analysis Plan

Analysis Plan Documents

Cambodia_Latrine_Finance_RCT_-_Pre-Analysis_Plan.pdf

MD5: ba3501625812d15c407e87aec19fb6eb

SHA1: 14bbcd9c0ace06ffbab0ba4bc860943aa3545f74

Uploaded At: November 08, 2013

Post-Trial

Post Trial Information

Study Withdrawal

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Intervention

Is the intervention completed?
No
Data Collection Complete
Data Publication

Data Publication

Is public data available?
No

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Abstract
Low willingness to pay (WTP) for environmental quality in developing countries is a key research question in environmental economics. One explanation is that missing credit markets may suppress WTP for environmental improvements that require large up-front investments. We test the impact of microloans on WTP for hygienic latrines via a randomized controlled trial in 30 villages in rural Cambodia. We find that microcredit dramatically raises WTP for improved latrines, with 60% of households in the Financing arm willing to purchase at an unsubsidized price, relative to 25% in the Non-financing arm. Effects on latrine installation are positive but muted by several factors, including a negative peer effect: randomly induced purchases by neighbors reduce a household's probability of installing its own latrine. On methodological grounds, this paper shows that a “decision-focused evaluation” can be integrated into academic analysis to provide insight into questions of general interest.
Citation
Ariel Ben Yishay, Andrew Fraker, Raymond Guiteras, Giordano Palloni, Neil Buddy Shah, Stuart Shirrell, Paul Wang, "Microcredit and willingness to pay for environmental quality: Evidence from a randomized-controlled trial of finance for sanitation in rural Cambodia," Journal of Environmental Economics and Management, 2017. ISSN 0095-0696; doi:10.1016/j.jeem.2016.11.004.
URL
http://dx.doi.org/10.1016/j.jeem.2016.11.004

Reports & Other Materials