Toward an Understanding of the Welfare Effects of Nudges: Evidence from a Field Experiment in Uganda

46 Pages Posted: 23 Sep 2019

See all articles by Erwin H. Bulte

Erwin H. Bulte

Wageningen UR - Development Economics Group

John A. List

University of Chicago - Department of Economics; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Daan van Soest

Tilburg University - CentER & Department of Economics

Date Written: September 2019

Abstract

Social scientists have recently explored how framing of gains and losses affects productivity. We conducted a field experiment in peri-urban Uganda, and compare output levels across 1000 workers over isomorphic tasks and incentives, framed as either losses or gains. We find that loss aversion can be leveraged to increase the productivity of labor. The estimated welfare costs of using the loss contract are quite modest – perhaps because the loss contract is viewed as a (soft) commitment device.

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Suggested Citation

Bulte, Erwin H. and List, John A. and van Soest, Daan P., Toward an Understanding of the Welfare Effects of Nudges: Evidence from a Field Experiment in Uganda (September 2019). NBER Working Paper No. w26286. Available at SSRN: https://ssrn.com/abstract=3458213

Erwin H. Bulte (Contact Author)

Wageningen UR - Development Economics Group ( email )

Hollandseweg 1
WAGENINGEN, 6706 KN
Netherlands

John A. List

University of Chicago - Department of Economics ( email )

1126 East 59th Street
Chicago, IL 60637
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Daan P. Van Soest

Tilburg University - CentER & Department of Economics ( email )

P.O. Box 90153
5000 LE Tilburg
Netherlands
+31 13 466 2072 (Phone)

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