Work

Loose knots: Strong versus weak commitments to save for education in Uganda

Year: 2024

Type: article

Abstract: Commitment devices offer an opportunity to restrict future choices. However, strict commitments may deter participation. Using a school-based commitment savings program for children to save for educational expenses in Uganda, we compare an account fully committed to school expenses to an account with a weaker commitment (funds withdrawn in cash, rather than a voucher). Children save more in the weaker commitment treatment arm, and when combined with parental outreach spend more on educational supplies and score 0.10 standard deviations (standard error = 0.04) on test scores. The fully committed account yields no such educational improvements, and neither account finds impacts on secondary or downstream outcomes such as attendance, enrollment, or non-cognitive skills. • Tethered funds restrain. • Yet weaker bonds free the mind—. • Learning finds its path. • And we learn that AI converts abstract to haiku-highlights quite well.

Source: Journal of Development Economics

DOI: 10.1016/j.jdeveco.2024.103444

Authors: Dean Karlan, Leigh L. Linden

Institutions: Northwestern University, National Bureau of Economic Research, The University of Texas at Austin

Language: English

Topic: Financial Literacy, Pension, Retirement Analysis

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

SDG: Quality education

Open Access status: hybrid

Estimated APC paid: $4,190