Persistent Effects of Temporary Incentives: Evidence from a Nationwide Health Insurance Experiment
Tinbergen Institute Discussion Paper 2019-078/V
48 Pages Posted: 2 Dec 2019
Date Written: November 12, 2019
Temporary incentives are offered in anticipation of persistent effects, but these are seldom estimated. We use a nationwide randomized experiment in the Philippines to estimate effects three years after the withdrawal of two incentives for health insurance. A premium subsidy had a persistent effect on enrollment that is more than four fifths of the immediate effect. Application assistance had a much larger immediate impact, but less than a fifth of this effect persisted. The subsidy persuaded those with higher initial willingness to pay to enroll and keep enrolling, while application assistance achieved a larger immediate effect by drawing in those who valued insurance less and were less likely to re-enroll.
Keywords: incentives, persistence, health insurance, subsidy, randomized experiment
JEL Classification: I13, C93
Suggested Citation: Suggested Citation