[go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/p/cpr/ceprdp/10224.html
   My bibliography  Save this paper

The Future in Mind: Aspirations and Forward-Looking Behaviour in Rural Ethiopia

Author

Listed:
  • Dercon, Stefan
  • Orkin, Kate
  • Bernard, Tanguy
  • Taffesse, Alemayehu
Abstract
Poor people often do not make investments, even when returns are high. One possible explanation is that they have low aspirations and form mental models of their future opportunities which ignore some options for investment. This paper reports on a field experiment to test this hypothesis in rural Ethiopia. Individuals were randomly invited to watch documentaries about people from similar communities who had succeeded in agriculture or business, without help from government or NGOs. A placebo group watched an Ethiopian entertainment programme and a control group were simply surveyed. In addition, the number of people invited was varied by village to assess the importance of peer effects in formation of aspirations. Six months after screening, aspirations had improved among treated individuals and did not change in the placebo or control groups. Treatment effects were larger for those with higher pre-treatment aspirations. We also find treatment effects on savings, use of credit, children's school enrolment and spending on children?s schooling, suggesting that changes in aspirations can translate into changes in a range of forward-looking behaviours. There are also treatment effects on measures from psychology and sociology, including locus of control, which theory predicts should behave in similar ways to aspirations. Most effects are robust to corrections for multiple testing. Peer effects results in further impact on educational spending and induce more work and less leisure. The result that a one-hour documentary shown six months earlier induces actual behavioural change suggests a challenging, promising avenue for further research and poverty-related interventions.

Suggested Citation

  • Dercon, Stefan & Orkin, Kate & Bernard, Tanguy & Taffesse, Alemayehu, 2014. "The Future in Mind: Aspirations and Forward-Looking Behaviour in Rural Ethiopia," CEPR Discussion Papers 10224, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:10224
    as

    Download full text from publisher

    File URL: https://cepr.org/publications/DP10224
    Download Restriction: CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Yoav Benjamini & Abba M. Krieger & Daniel Yekutieli, 2006. "Adaptive linear step-up procedures that control the false discovery rate," Biometrika, Biometrika Trust, vol. 93(3), pages 491-507, September.
    2. Anderson, Michael L., 2008. "Multiple Inference and Gender Differences in the Effects of Early Intervention: A Reevaluation of the Abecedarian, Perry Preschool, and Early Training Projects," Journal of the American Statistical Association, American Statistical Association, vol. 103(484), pages 1481-1495.
    3. Esther Duflo & Michael Kremer & Jonathan Robinson, 2008. "How High Are Rates of Return to Fertilizer? Evidence from Field Experiments in Kenya," American Economic Review, American Economic Association, vol. 98(2), pages 482-488, May.
    4. Karla Hoff & Joseph E. Stiglitz, 2010. "Equilibrium Fictions: A Cognitive Approach to Societal Rigidity," American Economic Review, American Economic Association, vol. 100(2), pages 141-146, May.
    5. Ernst Fehr & Karla Hoff, 2011. "Introduction: Tastes, Castes and Culture: the Influence of Society on Preferences," Economic Journal, Royal Economic Society, vol. 121(556), pages 396-412, November.
    6. Yang, Muzhe, 2007. "Identification and Estimation of Social Interaction-Based Models: A Changes-In-Changes Approach with an Application to Adolescent Substance Use," 2007 Annual Meeting, July 29-August 1, 2007, Portland, Oregon 9800, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    7. A. Colin Cameron & Jonah B. Gelbach & Douglas L. Miller, 2008. "Bootstrap-Based Improvements for Inference with Clustered Errors," The Review of Economics and Statistics, MIT Press, vol. 90(3), pages 414-427, August.
    8. Hans P. Binswanger, 1980. "Attitudes Toward Risk: Experimental Measurement in Rural India," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 62(3), pages 395-407.
    9. Shawn Cole & Xavier Gine & Jeremy Tobacman & Petia Topalova & Robert Townsend & James Vickery, 2013. "Barriers to Household Risk Management: Evidence from India," American Economic Journal: Applied Economics, American Economic Association, vol. 5(1), pages 104-135, January.
    10. David Card & Alexandre Mas & Enrico Moretti & Emmanuel Saez, 2012. "Inequality at Work: The Effect of Peer Salaries on Job Satisfaction," American Economic Review, American Economic Association, vol. 102(6), pages 2981-3003, October.
    11. Rafael Lalive & M. Alejandra Cattaneo, 2009. "Social Interactions and Schooling Decisions," The Review of Economics and Statistics, MIT Press, vol. 91(3), pages 457-477, August.
    12. Steffen Andersen & Glenn W. Harrison & Morten I. Lau & E. Elisabet Rutström, 2008. "Eliciting Risk and Time Preferences," Econometrica, Econometric Society, vol. 76(3), pages 583-618, May.
    13. Dean Karlan & Robert Osei & Isaac Osei-Akoto & Christopher Udry, 2014. "Agricultural Decisions after Relaxing Credit and Risk Constraints," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 129(2), pages 597-652.
    14. Gunhild Berg & Bilal Zia, 2017. "Harnessing Emotional Connections to Improve Financial Decisions: Evaluating the Impact of Financial Education in Mainstream Media," Journal of the European Economic Association, European Economic Association, vol. 15(5), pages 1025-1055.
    15. Alberto Chong & Eliana La Ferrara, 2009. "Television and Divorce: Evidence from Brazilian Novelas," Journal of the European Economic Association, MIT Press, vol. 7(2-3), pages 458-468, 04-05.
    16. Karen Macours & Renos Vakis, 2014. "Changing Households' Investment Behaviour through Social Interactions with Local Leaders: Evidence from a Randomised Transfer Programme," Economic Journal, Royal Economic Society, vol. 0(576), pages 607-633, May.
    17. Robert Jensen & Emily Oster, 2009. "The Power of TV: Cable Television and Women's Status in India," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(3), pages 1057-1094.
    18. Page, Lionel & Levy Garboua, Louis & Montmarquette, Claude, 2007. "Aspiration levels and educational choices: An experimental study," Economics of Education Review, Elsevier, vol. 26(6), pages 747-757, December.
    19. Sarah Baird & Aislinn Bohren & Berk Ozler & Craig McIntosh, 2014. "Designing Experiments to Measure Spillover Effects," Working Papers 2014-11, The George Washington University, Institute for International Economic Policy.
    20. Eliana La Ferrara & Alberto Chong & Suzanne Duryea, 2012. "Soap Operas and Fertility: Evidence from Brazil," American Economic Journal: Applied Economics, American Economic Association, vol. 4(4), pages 1-31, October.
    21. James Andreoni & Charles Sprenger, 2012. "Estimating Time Preferences from Convex Budgets," American Economic Review, American Economic Association, vol. 102(7), pages 3333-3356, December.
    22. Alberto Chong & Eliana La Ferrara, 2009. "Television and Divorce: Evidence from Brazilian Novelas," Journal of the European Economic Association, MIT Press, vol. 7(2-3), pages 458-468, 04-05.
    23. John F. Helliwell & Christopher P. Barrington-Leigh & Anthony Harris & Haifang Huang, 2009. "International Evidence on the Social Context of Well-Being," NBER Working Papers 14720, National Bureau of Economic Research, Inc.
    24. Heckman, James J. & Kautz, Tim, 2012. "Hard evidence on soft skills," Labour Economics, Elsevier, vol. 19(4), pages 451-464.
    25. Arthur T. Denzau & Douglass C. North, 1994. "Shared Mental Models: Ideologies and Institutions," Kyklos, Wiley Blackwell, vol. 47(1), pages 3-31, February.
    26. Esther Duflo & Emmanuel Saez, 2003. "The Role of Information and Social Interactions in Retirement Plan Decisions: Evidence from a Randomized Experiment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 118(3), pages 815-842.
    27. Ruth Vargas Hill & John Hoddinott & Neha Kumar, 2013. "Adoption of weather-index insurance: learning from willingness to pay among a panel of households in rural Ethiopia," Agricultural Economics, International Association of Agricultural Economists, vol. 44(4-5), pages 385-398, July.
    28. Stephen G. Donald & Kevin Lang, 2007. "Inference with Difference-in-Differences and Other Panel Data," The Review of Economics and Statistics, MIT Press, vol. 89(2), pages 221-233, May.
    29. Gharad Bryan & Shyamal Chowdhury & A. Mushfiq Mobarak, 2011. "Seasonal Migration and Risk Aversion," Working Papers id:4650, eSocialSciences.
    30. Gustavo J. Bobonis & Frederico Finan, 2009. "Neighborhood Peer Effects in Secondary School Enrollment Decisions," The Review of Economics and Statistics, MIT Press, vol. 91(4), pages 695-716, November.
    31. James J. Heckman & Jora Stixrud & Sergio Urzua, 2006. "The Effects of Cognitive and Noncognitive Abilities on Labor Market Outcomes and Social Behavior," Journal of Labor Economics, University of Chicago Press, vol. 24(3), pages 411-482, July.
    32. Rema Hanna & Sendhi Mullainathan & Josh Schwartstein, 2012. "Learning Through Noticing: Theory and Experimental Evidence in Farming," CID Working Papers 245, Center for International Development at Harvard University.
    33. Charles A. Holt & Susan K. Laury, 2002. "Risk Aversion and Incentive Effects," American Economic Review, American Economic Association, vol. 92(5), pages 1644-1655, December.
    34. MacLeod, W. Bentley & Pingle, Mark, 2005. "Aspiration uncertainty: its impact on decision performance and process," Journal of Economic Behavior & Organization, Elsevier, vol. 56(4), pages 617-629, April.
    35. Bernheim, B Douglas, 1994. "A Theory of Conformity," Journal of Political Economy, University of Chicago Press, vol. 102(5), pages 841-877, October.
    36. Nava Ashraf & Dean Karlan & Wesley Yin, 2006. "Tying Odysseus to the Mast: Evidence From a Commitment Savings Product in the Philippines," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 121(2), pages 635-672.
    37. Patricio S. Dalton & Sayantan Ghosal & Anandi Mani, 2016. "Poverty and Aspirations Failure," Economic Journal, Royal Economic Society, vol. 126(590), pages 165-188, February.
    38. Bisin, Alberto & Verdier, Thierry, 2001. "The Economics of Cultural Transmission and the Dynamics of Preferences," Journal of Economic Theory, Elsevier, vol. 97(2), pages 298-319, April.
    39. Markus Goldstein & Christopher Udry, 2008. "The Profits of Power: Land Rights and Agricultural Investment in Ghana," Journal of Political Economy, University of Chicago Press, vol. 116(6), pages 981-1022, December.
    40. S. Viswanathan & Adriano Rampini, 2013. "Household risk management," 2013 Meeting Papers 647, Society for Economic Dynamics.
    41. Ruth Vargas Hill, 2009. "Using Stated Preferences and Beliefs to Identify the Impact of Risk on Poor Households," Journal of Development Studies, Taylor & Francis Journals, vol. 45(2), pages 151-171.
    42. Herbert A. Simon, 1955. "A Behavioral Model of Rational Choice," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 69(1), pages 99-118.
    43. Robert Jensen, 2012. "Do Labor Market Opportunities Affect Young Women's Work and Family Decisions? Experimental Evidence from India," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 127(2), pages 753-792.
    44. Gunhild Berg & Bilal Zia, 2013. "Harnessing Emotional Connections to Improve Financial Decisions," World Bank Publications - Reports 22601, The World Bank Group.
    45. Ernst Fehr & Karla Hoff, 2011. "Tastes, castes, and culture: The influence of society on preferences," ECON - Working Papers 026, Department of Economics - University of Zurich.
    46. Charles F. Manski, 1993. "Identification of Endogenous Social Effects: The Reflection Problem," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 60(3), pages 531-542.
    47. Tanguy Bernard & Alemayehu Seyoum Taffesse, 2014. "Editor's choice Aspirations: An Approach to Measurement with Validation Using Ethiopian Data," Journal of African Economies, Centre for the Study of African Economies, vol. 23(2), pages 189-224.
    48. Samuel Bowles, 1998. "Endogenous Preferences: The Cultural Consequences of Markets and Other Economic Institutions," Journal of Economic Literature, American Economic Association, vol. 36(1), pages 75-111, March.
    49. Dercon, Stefan & Singh, Abhijeet, 2013. "From Nutrition to Aspirations and Self-Efficacy: Gender Bias over Time among Children in Four Countries," World Development, Elsevier, vol. 45(C), pages 31-50.
    50. Bruce Sacerdote, 2001. "Peer Effects with Random Assignment: Results for Dartmouth Roommates," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 116(2), pages 681-704.
    51. David Card & Alex Mas & Enrico Moretti & Emmanuel Saez, 2010. "Inequality at Work: The Effect of Peer Salaries on Job Satisfaction," Working Papers 1269, Princeton University, Department of Economics, Industrial Relations Section..
    52. Bruce Wydick & Paul Glewwe & Laine Rutledge, 2013. "Does International Child Sponsorship Work? A Six-Country Study of Impacts on Adult Life Outcomes," Journal of Political Economy, University of Chicago Press, vol. 121(2), pages 393-436.
    53. Edward Miguel & Michael Kremer, 2004. "Worms: Identifying Impacts on Education and Health in the Presence of Treatment Externalities," Econometrica, Econometric Society, vol. 72(1), pages 159-217, January.
    54. ,, 2000. "Problems And Solutions," Econometric Theory, Cambridge University Press, vol. 16(2), pages 287-299, April.
    55. Gustavo J. Bobonis & Edward Miguel & Charu Puri-Sharma, 2006. "Anemia and School Participation," Journal of Human Resources, University of Wisconsin Press, vol. 41(4).
    56. McKenzie, David, 2012. "Beyond baseline and follow-up: The case for more T in experiments," Journal of Development Economics, Elsevier, vol. 99(2), pages 210-221.
    57. Simon, Herbert A, 1979. "Rational Decision Making in Business Organizations," American Economic Review, American Economic Association, vol. 69(4), pages 493-513, September.
    58. Kahneman, Daniel, 2002. "Maps of Bounded Rationality," Nobel Prize in Economics documents 2002-4, Nobel Prize Committee.
    59. Kaivan Munshi & Mark Rosenzweig, 2006. "Traditional Institutions Meet the Modern World: Caste, Gender, and Schooling Choice in a Globalizing Economy," American Economic Review, American Economic Association, vol. 96(4), pages 1225-1252, September.
    60. repec:hal:pseose:halshs-01053534 is not listed on IDEAS
    61. Robert Jensen, 2010. "The (Perceived) Returns to Education and the Demand for Schooling," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 125(2), pages 515-548.
    62. Tanguy Bernard & Alemayehu Seyoum Taffesse, 2014. "Aspirations: An approach to measurement with validation using ethiopian data," Post-Print hal-03022496, HAL.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Anandi Mani & Emma Riley, 2019. "Social networks, role models, peer effects, and aspirations," WIDER Working Paper Series wp-2019-120, World Institute for Development Economic Research (UNU-WIDER).
    2. Kandpal, Eeshani & Baylis, Kathy, 2019. "The social lives of married women: Peer effects in female autonomy and investments in children," Journal of Development Economics, Elsevier, vol. 140(C), pages 26-43.
    3. Steinert, Janina Isabel & Cluver, Lucie Dale & Meinck, Franziska & Doubt, Jenny & Vollmer, Sebastian, 2018. "Household economic strengthening through financial and psychosocial programming: Evidence from a field experiment in South Africa," Journal of Development Economics, Elsevier, vol. 134(C), pages 443-466.
    4. Bonan, Jacopo & Battiston, Pietro & Bleck, Jaimie & LeMay-Boucher, Philippe & Pareglio, Stefano & Sarr, Bassirou & Tavoni, Massimo, 2021. "Social interaction and technology adoption: Experimental evidence from improved cookstoves in Mali," World Development, Elsevier, vol. 144(C).
    5. G.T. Abate & Tanguy Bernard & Simrin Makhija & David J. Spielman, 2019. "Accelerating technical change through video-mediated agricultural extension: Evidence from Ethiopia," Working Papers hal-02879823, HAL.
    6. Janzen, Sarah A. & Magnan, Nicholas & Sharma, Sudhindra & Thompson, William M., 2017. "Aspirations failure and formation in rural Nepal," Journal of Economic Behavior & Organization, Elsevier, vol. 139(C), pages 1-25.
    7. Katrina Kosec & Kamiljon Akramov & Bakhrom Mirkasimov & Jie Song & Hongdi Zhao, 2022. "Aspirations and women's empowerment: Evidence from Kyrgyzstan," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 30(1), pages 101-134, January.
    8. Ross, Phillip H. & Glewwe, Paul & Prudencio, Daniel & Wydick, Bruce, 2021. "Developing educational and vocational aspirations through international child sponsorship: Evidence from Kenya, Indonesia, and Mexico," World Development, Elsevier, vol. 140(C).
    9. Raghunathan, Kalyani & Quisumbing, Agnes R. & Kumar, Neha & Cunningham, Kenda, 2018. "Women’s aspirations for the future, and their financial, social and educational investments," IFPRI discussion papers 1752, International Food Policy Research Institute (IFPRI).
    10. Hoff, Karla & Stiglitz, Joseph E., 2016. "Striving for balance in economics: Towards a theory of the social determination of behavior," Journal of Economic Behavior & Organization, Elsevier, vol. 126(PB), pages 25-57.
    11. Ghada Barsoum & Bruno Crépon & Drew Gardiner & Bastien Michel & William Parienté, 2022. "Evaluating the Impact of Entrepreneurship Edutainment in Egypt: An Experimental Approach," Economica, London School of Economics and Political Science, vol. 89(353), pages 82-109, January.
    12. BenYishay, Ariel & Mobarak, A. Mushfiq, 2013. "Communicating with Farmers through Social Networks," Center Discussion Papers 156233, Yale University, Economic Growth Center.
    13. Shelly Lundberg, 2023. "Gender Economics: Dead-Ends and New Opportunities," Research in Labor Economics, in: 50th Celebratory Volume, volume 50, pages 151-189, Emerald Group Publishing Limited.
    14. Carol Graham & Julia R. Pozuelo, 2023. "Do high aspirations lead to better outcomes? Evidence from a longitudinal survey of adolescents in Peru," Journal of Population Economics, Springer;European Society for Population Economics, vol. 36(3), pages 1099-1137, July.
    15. Orazio Attanasio & Matthew Bird & Lina Cardona-Sosa & Pablo Lavado, 2019. "Freeing Financial Education via Tablets: Experimental Evidence from Colombia," NBER Working Papers 25929, National Bureau of Economic Research, Inc.
    16. Dalton, Patricio & Rüschenpöhler, Julius & Uras, Burak & Zia, Bilal, 2019. "Local Best Practices for Business Growth," Other publications TiSEM fc650e2f-88cf-4d75-8257-f, Tilburg University, School of Economics and Management.
    17. Glenn W. Harrison & Jia Min Ng, 2019. "Behavioral insurance and economic theory: A literature review," Risk Management and Insurance Review, American Risk and Insurance Association, vol. 22(2), pages 133-182, July.
    18. Ariel BenYishay & A. Mushfiq Mobarak, 2014. "Social Learning and Communication," NBER Working Papers 20139, National Bureau of Economic Research, Inc.
    19. Abramitzky, Ran & Lavy, Victor & Pérez, Santiago, 2021. "The long-term spillover effects of changes in the return to schooling," Journal of Public Economics, Elsevier, vol. 196(C).

    More about this item

    JEL classification:

    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cpr:ceprdp:10224. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://www.cepr.org .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.