Abstract
In Malawi, 6.7 million people experience hunger between harvests with serious impacts on health, child development and economic outcomes. Our prior research (Cognitive constraints in consumption smoothing, RCT ID AEARCTR-0004409) applied techniques from the psychology literature to the complex planning problem facing smallholder farmers: how to allocate annual harvest income across the many months before the next harvest.
We will conduct a randomized evaluation of a low-cost, light-touch and portable planning exercise that draws on a large literature in psychology demonstrating how humans have difficulty making realistic plans for the future. This is a scale up of our original project, conducted in collaboration with One Acre Fund (1AF), a social enterprise that provides agricultural input loans and training services its smallholder client farmers.
Our planning intervention gives farmers a structured way of budgeting their available harvest income to cover expenses; this makes spending plans more realistic and creates urgency around the need to save early in the season. The exercise prompts farmers to 1) think through all potential income and expenditures using categories, 2) use a visual planning board to create a plan for spending and savings over the year and 3) attach labels representing the plan to existing maize stocks. The intervention is farmer-centered, low-cost (uses simple, cheap, and easily replicable materials), quick, suitable for group settings and low-literacy, and adaptable across contexts.
Farming households are randomly assigned, at the group level, to receive the budgeting intervention (treatment) or not (control). We will measure impacts on savings, consumption (including work) and farm output.