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

45 Pages Posted: 17 Nov 2014

See all articles by Bernard Tanguy

Bernard Tanguy

International Food Policy Research Institute (IFPRI)

Stefan Dercon

University of Oxford - Department of Economics

Kate Orkin

University of Oxford - Department of Economics

Alemayehu Seyoum Taffesse

International Food Policy Research Institute (IFPRI)

Multiple version iconThere are 2 versions of this paper

Date Written: October 2014

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.

JEL Classification: D02, I31

Suggested Citation

Tanguy, Bernard and Dercon, Stefan and Orkin, Kate and Taffesse, Alemayehu Seyoum, The Future in Mind: Aspirations and Forward-Looking Behaviour in Rural Ethiopia (October 2014). CEPR Discussion Paper No. DP10224. Available at SSRN: https://ssrn.com/abstract=2526352

Bernard Tanguy (Contact Author)

International Food Policy Research Institute (IFPRI) ( email )

1201 Eye St, NW,
Washington, DC 20005
United States

Stefan Dercon

University of Oxford - Department of Economics ( email )

Manor Road Building
Manor Road
Oxford, OX1 3BJ
United Kingdom
44 1865 271084 (Phone)
44 1865 271094 (Fax)

Kate Orkin

University of Oxford - Department of Economics ( email )

10 Manor Rd
Oxford, Oxfordshire OX1 3UQ
United Kingdom

HOME PAGE: http://https://sites.google.com/site/kateorkin/home

Alemayehu Seyoum Taffesse

International Food Policy Research Institute (IFPRI) ( email )

1201 Eye St, NW,
Washington, DC 20005
United States

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