Cash in hand and savings decisions

Last registered on July 05, 2023


Trial Information

General Information

Cash in hand and savings decisions
Initial registration date
February 21, 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
February 21, 2017, 2:29 PM EST

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

Last updated
July 05, 2023, 11:03 AM EDT

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



Primary Investigator

RWTH Aachen University and University of Essex

Other Primary Investigator(s)

Additional Trial Information

Start date
End date
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Most of the poor receive their income in cash and they seem to readily spend it instead of saving some of it. Offering commitment devices to overcome present bias or sending reminders to tackle inattention and forgetfulness only seem to yield modest improvements. In particular, usage levels of formal savings account usually remain low. What if the act itself, depositing the cash into the account or handing it over to the loan officer is associated with non-monetary costs that prevents individuals from saving? Based on a literature that shows reduced spending levels when cash is the means of transaction, I hypothesize that a "cash-in-hand" effect also exists for savings, i.e. individuals become attached to their cash and are reluctant to 'give it away' to save it. I test this hypothesis in a framed field experiment with rural and semi-urban poor in the Philippines ruling out other explanations for undersavings (part 1). As this bias arises due to mental accounting, a small intervention additionally tries to change how participants think about the cash they could save (part 2).
External Link(s)

Registration Citation

Spantig, Lisa. 2023. "Cash in hand and savings decisions." AEA RCT Registry. July 05.
Former Citation
Spantig, Lisa. 2023. "Cash in hand and savings decisions." AEA RCT Registry. July 05.
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Experimental Details


Intervention Start Date
Intervention End Date

Primary Outcomes

Primary Outcomes (end points)
Part 1: decision to save during the survey (amount saved)

Part 2: weekly savings deposits into personal savings account in week 1-4 after the intervention, savings balance on this account after week 4 (short run outcomes); reassessment of these outcomes after 6 month (medium rum outcomes)
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
The study consists of a framed field experiment (part 1) and a field experiment (part 2). The first part tests the 'cash-in-hand' effect on savings decisions. Participants take part in a paid individual survey and decide whether and if so, how much of their participation fee they want to save in their existing savings account. The treatment variation consists of receiving the participation fee at the very beginning of the survey, thus holding on to the cash when making the decision vs. receiving the remainder of the participation fee (everything that is not saved) directly after the savings decision. The second part of the study is a field experiment testing the effect of a combination of mental accounting and reminders on savings.
Experimental Design Details
The experiment will be a mixture of a framed field experiment (part 1) and a field experiment (part 2).

Part 1: Effect of cash-in-hand on savings
One week before the session, potential participants receive an announcement letter, informing them about the possibility to take part in paid individual interviews that will earn at least 300 pesos. The session itself takes place during the weekly center meeting that all clients are supposed to attend. Volunteers will be privately surveyed one-on-one by a local interviewer using a tablet. The survey consists of three parts.
The first part (and the overall duration) is announced during the recruitment and includes questions regarding personal characteristics, the composition of the household and its financial situation. At the end of the first part, participants are asked whether they want to save (a part of) their participation fee in their personal savings account and if so, how much. Savings will be matched with 20% after one month to reduce the potential impact of present bias. The second part of the survey consists of an incentivized elicitation of risk and time preferences as well as loss aversion. The third part includes survey questions regarding savings behavior and financial literacy.

Two treatments are implemented in a 2x2 design: 'cash-in-hand' vs control and normal (300 pesos) vs surprise (500 pesos) participation fee. The 'cash-in-hand' treatment variation consists of paying the remuneration at the beginning of the first part or after the savings decision and is randomized on the individual level. Participants in the treatment will hold onto the cash during the first part. Based on endowment experiments regarding goods, it is expected that physical possession (Bushong et al. 2010) and the duration of 'ownership' (Strahilevitz and Loewenstein 1998) create an endowment effect w.r.t. the cash. Treated participants will thus have a harder time handing the money back to the interviewer who will give it to the loan officer supervising the center meeting after the entire interview is over. In contrast, participants in the control group will make the savings decision without holding the money in their hands, but knowing that they will receive the remainder of their participation fee just after the savings decision.
The amount of the participation fee will be randomized on borrower center (i.e. session) level and will only be announced after the recruitment to avoid selection effects. While the normal participation fee might already have entered the participants' budget, the 200 additional pesos in the surprise treatment should be treated as a true windfall gain.

Part 2: Labeling and reminder
At the very end of the experiment when all savings will have been deposited, all present members of the center will take part in a short survey regarding their weekly income and expenditures. The CONTROL group will then be released. In treated centers, individuals will receive a 'savings card' which they personalize by writing down their name on it. They are encouraged to take the card home and place it visibly in their living room, such that the card serves as a reminder to save (comparable to previous studies that remind participants to save, e.g. Karlan et al. 2016). To ensure everyone receives a card they really like, three different designs have been developed using extensive pre-testing. Each participant will be allowed to choose her favorite card. This is the pure REMINDER treatment.
In the LABEL treatment, participants also receive a savings card and they personalize it. In addition, they will be guided to find an individual income frontier beyond which income will be labeled as savings. Participants will be asked to think about their next week's expenses for different items which they need to cover with their income and are instructed to save all income above this threshold. By labeling ''excess'' income as savings, mental accounting might help participants to save more. Participants will note their personal frontier on the savings card and pens will be provided to change the frontier after the first week.
Comparing the REMINDER and LABEL treatments allows me to estimate the ITT of labeling and accounting.
Administrative data will be used to evaluate the effectiveness of the two cards and savings levels in control centers that did not receive any card. After one month, the research team will revisit the center to pay the match from the lab-in-the-field experiment. During this occasion, a small survey will be administered concerning the use of the cards as well as income and expenditure levels during the last week.
Randomization Method
Randomization will be done in STATA.
Randomization Unit
Part 1 will be randomized on the individual level (Cash-in-hand) and on the session level (participation fee amount).

Part 2 will be randomized on barangays (smallest administrative unit) to avoid confounding effects from very close centers.
Was the treatment clustered?

Experiment Characteristics

Sample size: planned number of clusters
Part 1: no cluster for cash-in-hand treatment, 30 clusters for participation fee treatment
Part 2: 20 barangays
Sample size: planned number of observations
Part 1: 300 individuals (microfianance clients) Part 2: 871 individuals (if all active clients attend the meetings)
Sample size (or number of clusters) by treatment arms
Part 1:
- 75 individuals control and normal participation fee
- 75 individuals cash-in-hand and normal participation fee
- 75 individuals control and surprise participation fee
- 75 individuals cash-in-hand and surprise participation fee

Part 2:
- 3 barangays (100 individuals) CONTROL
- 10 barangays (447 individuals) REMINDER & LABEL
- 7 barangays (324 individuals) REMINDER
- all remaining barangays served by the three involved branches of the partner MFI serve as additional control (based on administrative data only)
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)

Institutional Review Boards (IRBs)

IRB Name
Ethics Committee, Economics Department, LMU Munich
IRB Approval Date
IRB Approval Number
Analysis Plan

Analysis Plan Documents

Pre-Analysis Plan for lab-in-the-field part

MD5: 7d95bac7e8e19679dd08f47b9c63e954

SHA1: 9afedc82ac4f2d10c7d6c4c7db2acb7c240ab4a3

Uploaded At: May 29, 2017


Post Trial Information

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Is the intervention completed?
Data Collection Complete
Data Collection Completion Date
Final Sample Size: Number of Clusters (Unit of Randomization)
Was attrition correlated with treatment status?
Final Sample Size: Total Number of Observations
Final Sample Size (or Number of Clusters) by Treatment Arms
Data Publication

Data Publication

Is public data available?

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Spantig (2021): Cash in hand and saving decisions. Journal of Economic Behavior & Organization (2021), 188: 1206-1220.
Cash is an important means of transaction, generally assumed to be fungible. However, behavioral economics and consumer research show that ‘cash in hand’, physically holding on to cash and then handing it away, affects purchasing decisions. I study how cash in hand influences decisions in a different, but very important domain: savings. Savings accounts are a promising tool for reducing poverty, but the use of savings accounts is often puzzlingly low. Holding on to cash that needs to be physically deposited into a savings account may increase the psychological costs of saving. This study experimentally identifies the causal effect of cash in hand on savings deposits of female microfinance clients in the Philippines. In contrast to many laboratory and several field studies with similar interventions, I do not find reduced savings deposits due to cash in hand.

Reports & Other Materials