Self-Control and Demand for Preventive Health: Evidence from Hypertension in India

Liang Bai, Benjamin Handel, Edward Miguel and Gautam Rao

No 23727, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Self-control problems constitute a potential explanation for the under-investment in preventive health care observed in low-income countries. A commonly proposed policy tool to solve such problems is offering consumers commitment devices. We conduct a field experiment to evaluate the effectiveness of different types of theoretically-motivated commitment contracts in increasing preventive doctor visits by hypertensive patients in rural India. We document varying levels of takeup of the different commitment contracts, but find no effects on actual doctor visits or individual health outcomes. Thus, a substantial number of individuals pay for commitments, but then fail to follow through on the specified task, losing money without experiencing any health benefit. We develop and structurally estimate a pre-specified model of consumer behavior under present bias with varying levels of naivete. The results are consistent with a large share of individuals being partially naive about their own self-control problems: in other words, they are sophisticated enough to demand some commitment, but overly optimistic about whether a given commitment is sufficiently strong to be effective. The results suggest that commitment devices may in practice be welfare diminishing, at least in some contexts, and serve as a cautionary tale about the role of these contracts in the health care sector.

JEL-codes: D91 I12 (search for similar items in EconPapers)
Date: 2017-08
New Economics Papers: this item is included in nep-exp, nep-hea and nep-mkt
Note: DEV EH
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Citations: View citations in EconPapers (15)

Published as Liang Bai & Benjamin Handel & Edward Miguel & Gautam Rao, 2021. "Self-Control and Demand for Preventive Health: Evidence from Hypertension in India," The Review of Economics and Statistics, MIT Press, vol. 103(5), pages 835-856, December.
Published as Liang Bai & Benjamin Handel & Edward Miguel & Gautam Rao, 2021. "Self-Control and Demand for Preventive Health: Evidence from Hypertension in India," The Review of Economics and Statistics, vol 103(5), pages 835-856.

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Journal Article: Self-Control and Demand for Preventive Health: Evidence from Hypertension in India (2021)
Working Paper: Self-Control and Demand for Preventive Health: Evidence from Hypertension in India (2021)
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