The experimental session is conducted with families (mother, father, one child). All subjects will participate in a patience experiment. Fathers and mothers take part in a decision-making experiment. Mothers additionally attend an experiment designed to measure their empowerment in the household. In the following the designs of all three parts are described in detail:
Patience Elicitation: Time preferences are elicited with choice lists with early and delayed payoffs or time-investment exercises. The choice lists used in the experiment additionally allow for a measure of present-biasedness. Subjects will select their preferred choice in a list of 10 decisions per decision sheet. For instance choices are made between upfront payoff of 5000 TSh and delayed payoffs between 5.000
and 10.000 TSh (1 USD ~ 2180 TSh). Starting with equal payoffs the delayed option increases monotonically. Two decision sheets are presented to the subjects in random order. After all choices are made, one list and one decision are randomly selected for payout. Particular focus is placed on trust issues related to the delayed payment option. Using the observed switching point from early to delayed payoff, the future equivalent (FE) is calculated at the midpoint of the two delayed payoffs around the switching point. Normalizing it by the early payoff results in a comparable indicator for patience. The higher the normalized future equivalent, the more impatient is the individual.
Measure for female empowerment in the household: To measure decision-weights in the household I will apply two approaches. The first part consists of a set of question on the decision-making process across various subcategories, such as food, educational expenses and financial decisions. For these questions tie-breaker questions are included to avoid bunching at the joint decision option. Additionally
women’s empowerment, i.e. their decision weight, in the household is measured using an incentivized experiment. Women’s willingness to pay to receive a cash transfer themselves rather than their spouse is directly measured. The design follows a choice list type representation of pre-specified values, for which the mother chooses that the amount is paid either to the father or to herself. The amount for the father remains constant, while the mother’s amount decreases monotonically. Full information on payouts, but not on actual experimental choices, is given to both the woman and the spouse, thereby excluding hiding motives. By randomly assigning starting values, it can be assured that spouses cannot learn about women’s choices from the payouts.
Decision-making experiment: Each parent is asked to make an individual decisions, separated from the partner. In the first stage, the individual decision is elicited. The parent is asked to indicate his or her preferred division of a 10.000 TSh budget (around 4,5 USD) between a consumption good and an educational voucher for the child. The voucher represents a commitment device for child investment. The value of the voucher relative to the consumption option is multiplied by a factor two, such that any the monetary value dedicated to the voucher is twice the value of the cash option. The vouchers, which can be used to purchase high-priced stationary such as text books, exercise
books and mathematical sets can be used in the stationary show in direct vicinity to the school. The revealed preference for educational investment is measured by the budget share allocated to the voucher. Subjects are additionally asked to mark their belief about the spouse’s preference (incentivized).
In the second stage, income pooling decisions are collected for several treatment levels: Each parent is asked to indicate whether to stay with the individual decision from stage one or to switch to joint decision-making with the spouse for a number of ’joint premium’ levels that are reflected in increased budgets to be divided between consumption and voucher. This means the choice in the joint option will differ from
the individual stage only in its pay-off structure. For each first stage choice there are four second stage decisions, where the joint budgets are treated with -20, 0, 20 or 40 % excess payoff. Depending on the choice in the second stage the final payout will be determined. One of the final choices will then be randomly selected for payout. If a parent has chosen the individual option for that choice, then the payout is determined from the decision in the first stage. If a parent has chosen the joint option for that choice, the decision will be made together with the spouse.
Within the data collection process, subjects in the experimental session also participate in a distributional preference experiment for an additional research project. For the same reason children take part in patience and distributional preferences experiments.