The PIs conducted a randomized controlled trial to measure the impact of a transaction fee discount on remittances from Salvadoran and Guatemalan migrant workers in the Washington, D.C. area. The PIs also included an additional element intended to measure the impact of remittances on education in a migrant's home country; however, the analysis is primarily focused on the impacts of the discount. After a baseline survey, the participants were given an envelope containing their random assignment to one of the control or treatment groups.
The intervention included two treatments. For the first, the Discount treatment, participants received a discount card for $3.01 off of the transaction fee for all remittances sent from that location for the next ten weeks. The discount was only applicable to remittances sent to the previously-designated primary remittance recipient (PRR). For the second, the Education Information treatment, participants received an information sheet about the benefits of secondary and tertiary education in their home country. The treatments were cross-randomized in a two-by-two experimental design, yielding a control group and three treatment groups: Education Information Only, Discount and Education, and Discount Only.
The PIs found that the Discount Only treatment had economically and statistically significant positive effects on the number of remittances and total amount remitted. These effects persisted for up to 20 weeks after the discount had ended, suggesting that participants were not inter-temporally substituting future remittances to take advantage of the discount. The Discount and Education treatment had similar but smaller effects, and only for remittances to the PRR were the effects statistically significant. The Education Information Only treatment had no statistically significant effect on any outcomes.