Financial Incentives as Signals: Experimental Evidence from the Recruitment of Community Health Promoters in rural Uganda

Last registered on December 15, 2016

Pre-Trial

Trial Information

General Information

Title
Financial Incentives as Signals: Experimental Evidence from the Recruitment of Community Health Promoters in rural Uganda
RCT ID
AEARCTR-0001852
Initial registration date
December 15, 2016

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
December 15, 2016, 3:01 PM EST

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

Locations

Primary Investigator

Affiliation
Northwestern University

Other Primary Investigator(s)

Additional Trial Information

Status
Completed
Start date
2012-05-15
End date
2014-08-15
Secondary IDs
Abstract
I study the role of financial incentives as signals of job characteristics when these are unknown to potential applicants. To this end, I create experimental variation in expected earnings and use that to estimate the effect of financial incentives on candidates' perception of a brand-new health-promoter position in Uganda and on the resulting size and composition of the applicant pool. I find that more lucrative positions are perceived as entailing a lower positive externality for the community and discourage agents with strong prosocial preferences from applying. While higher financial incentives attract more applicants and increase the probability of filling a vacancy, the signal they convey reduces the ability to recruit the most socially motivated agents, who are found to stay longer on the job and to perform better.
External Link(s)

Registration Citation

Citation
DESERRANNO, ERIKA. 2016. "Financial Incentives as Signals: Experimental Evidence from the Recruitment of Community Health Promoters in rural Uganda." AEA RCT Registry. December 15. https://doi.org/10.1257/rct.1852
Former Citation
DESERRANNO, ERIKA. 2016. "Financial Incentives as Signals: Experimental Evidence from the Recruitment of Community Health Promoters in rural Uganda." AEA RCT Registry. December 15. https://www.socialscienceregistry.org/trials/1852/history/12482
Experimental Details

Interventions

Intervention(s)
Intervention Start Date
2012-07-15
Intervention End Date
2012-11-15

Primary Outcomes

Primary Outcomes (end points)
candidate perceptions about the job before recruitment, size and composition of the application and worker pool, worker retention and performance
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
The empirical design is composed of two experiments. The first experiment (information experiment) tests the signal channel of financial incentives by collecting data on agents' perception after the job is advertised as being more or less lucrative. The effect of financial incentives on the applicant pool is analyzed in a separate experiment—the recruitment experiment—in which a candidate's decision on whether to apply is recorded without any questions on perceptions having been asked prior to that decision (and hence without distorting expectations).

The exogenous variation used in both experiments is identical: experimentally changes the way the job is advertised, i.e., exogenously change whether the position is advertised as being high, medium or low paying, while the actual incentives do not change. The high-pay treatment reveals the maximum of the earnings distribution (“CHPs earn up to 200 thousand UGX per month”), the medium-pay treatment reveals the mean (“CHPs earn an average of 30 thousand UGX per month”) and the low-pay treatment reveals the minimum (“CHPs earn at least 7 thousand UGX per month”).
Experimental Design Details
Randomization Method
Randomization done in office by a computer
Randomization Unit
Village level randomization (recruitment experiment), respondent level randomization (information experiment)
Was the treatment clustered?
Yes

Experiment Characteristics

Sample size: planned number of clusters
15 branches (recruitment experiment), 231 rural communities across 4 branches (information experiment)
Sample size: planned number of observations
315 rural communities (recruitment experiment), 6,845 respondents (information experiment)
Sample size (or number of clusters) by treatment arms
Recruitment experiment: 105 communities in Low-Pay Treatment, 104 in Medium-Pay, 106 in High-Pay
Information experiment: 2,296 respondents in Low-Pay Treatment, 2,279 in Medium-Pay, 2,270 in High-Pay
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
IRB

Institutional Review Boards (IRBs)

IRB Name
IRB Approval Date
IRB Approval Number

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)

Reports & Other Materials