Rational Habit Formation: Experimental Evidence from Handwashing in India
94 Pages Posted: 22 Sep 2017 Last revised: 10 Feb 2020
Date Written: September 4, 2019
We test the main predictions of the rational addiction model, reconceptualized as rational habit formation, in the context of handwashing. To track habit formation, we design soap dispensers with timed sensors. We test for rational habit formation by informing some households about a future change in the returns to daily handwashing. Child weight and height increase for all households with dispensers. Monitoring and incentives raise handwashing contemporaneously, and effects persist well after they end. Anticipation of future monitoring further raises handwashing: individuals internalize handwashing's habitual nature and accumulate stock. Our results inform policy design around the adoption of healthy behaviors.
JEL Classification: D04, D83, D91, I12
Suggested Citation: Suggested Citation