This is a cross-post from Development Impact
Economists believe that incentives matter and that they can be used for changing people’s behaviors. Incentives are used for encouraging school attendance and performance or for increasing the coverage and quality of health care delivery. But a recurrent question is what happens once the incentives are discontinued? Are the incentives’ effects going to be sustained even after their payment is stopped because individuals would have been nudged towards a different behavior? Or are those effects going to die down and disappear once incentives are removed? The answer to that question has obvious consequences in terms on long run sustainability and cost effectiveness of incentive schemes.
Francisco Costa addressed the more general question of the long-term effect of temporary interventions in a previous blog post, in which he documented that an eight-month compulsory rationing imposed on Brazilian households’ electricity use in 2001 led to a persistent reduction in electricity use of 14% even ten years later. As he noted, the evidence on the long-term impact of temporary incentives is mixed. On the one hand, Giné et al. 2010 find in the Philippines that a commitment device for smoking cessation had persistent effect beyond the duration of the intervention and Dupas 2013 found that a one-time subsidy for antimalarial bed nets in Kenya had a positive impact on willingness to pay for the product a year later. On the other hand, also in Kenya, Kremer and Miguel 2007 find that take-up of deworming drugs that was initially subsidized was reduced by 80% after the introduction of a small drug cost-recovery program.
Further, it is often argued that financial incentives might be overemphasizing extrinsic motivation (engaging in a behavior because it is financially rewarded), potentially at the expense of intrinsic motivation (engaging in a behavior because it is valued as such). If this is true, linking financial rewards to some behaviors might destroy the intrinsic motivation and leave us with lower levels of engagement after incentives are stopped.
The results from a recent experiment rewarding safe sex in Tanzania shed some light on these questions. In order to test innovative approaches to behavioral change to strengthen prevention and stem the HIV/AIDS epidemic, in collaboration with the Ifakara Health Institute in Tanzania and, the University of California at Berkeley, we designed and evaluated a novel intervention using conditional cash transfers (CCTs) for HIV prevention. The intervention tests for risky sexual behavior repeatedly over short time intervals, reinforcing learning about safer sexual behavior with incentives each time.
The study enrolled 2399 participants in 10 villages in rural south-west Tanzania. The intervention arm received CCTs that depended on negative results of periodic screenings for sexually transmitted infections (STIs) – an objectively measured marker for risky sexual behavior. The intervention arm was further divided into two sub-groups – one receiving a “high value” CCT payment of up to $60 over the course of the study ($20 payments every four months) and the other receiving a lower value payment of up to $30 ($10 payments every four months).
We have reported some of the short-term impacts of that CCT intervention incentivizing safe sex on STI prevalence earlier (de Walque, Dow, Nathan et al. 2012). At the end of the one year intervention, the results showed a significant reduction in STIs in the group that was eligible for the $20 payments every four months, but no such reduction was found for the group receiving the $10 payments. Further, at the end of the intervention, the impact of the CCTs did not differ between males and females, but the impact was larger among individuals who were STI positive at baseline.
Can the impacts be sustained once the CCTs are discontinued?
Those are interesting results, but the Tanzanian Minister of Finance would be entitled to ask: do we need to pay people for the entire length of their sexual life in order for them to choose safe sex? This is a fair question. Recognizing that such an intervention would be difficult to sustain over the length of individuals’ sexual lives, we explicitly tested whether they were sustained effects after the end of the intervention. We evaluated its long-term effects using a post-intervention follow-up survey conducted one year after discontinuing the intervention. We left the population on its own for 1 full year, with no testing and no conditional cash transfers. And then after this full year, we came back and tested and interviewed the study participants. We report the results in a recent working paper.
Learning or Reduced Intrinsic Motivation?
There could be 3 outcomes when testing for sustained effects: i) sustained impacts in reducing STI prevalence, ii) zero long run effects or iii) adverse long run effects.
For behaviors which individuals may not have tried until encouraged to by the incentives (e.g., use of condoms), it is possible that the incentives will induce learning (and reinforcement) that could result in permanent positive behavior changes even after withdrawal of the incentives.
The absence of long run effects would rather suggest that incentives need to be continued for sustained effects.
Alternatively, psychologists have emphasized the potentially pernicious effects of extrinsic monetary incentives in destroying the intrinsic desire to engage in positive behaviors. Cameron et al. 2001 and Gneezy et al. 2011 review the literature on the possible destruction of intrinsic incentives. While Gneezy et al. 2011 conclude that “incentives do matter, but in various and sometimes unexpected ways”, Cameron et al. 2001’s take is that reduced intrinsic motivation might occur for some tasks which are interesting in themselves, for example, drawing pictures among children, but that in general and for tasks which do not present a lot of interest by themselves - condom use in our case of HIV prevention could be an example- incentives do not have pervasive adverse effects.
Sustained effects, but only for men
The results of the one year post-intervention follow-up indicate that both the high and low values CCTs have had a sustained impact in reducing the STI prevalence by 18 to 20% risk among the study population. They suggest that the CCT interventions might have sustained effect even after the cash payments have been discontinued and that there might a learning effect. They also imply that CCTs do not destroy the intrinsic motivation to adopt safe sexual practices since no increased risk was reported in the intervention groups. Those are important results when considering the potential feasibility at scale and sustainability of our CCT intervention.
However the disaggregation of the results by gender is interesting. The analysis shows a sustained effect among males but not among females. One possible interpretation of that finding is that, while the CCT intervention contributed to create safer sex habits among men, the cash component of the intervention might be important for women in their efforts to negotiate safe sex.