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Can incentives lead to sustained impacts? The case of rewarding safe sex.

Damien de Walque's picture
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?

DFID is Changing its Approach to Better Address the Underlying Causes of Poverty and Conflict – Can it Work? Guest Post from two DFID Reformers

Duncan Green's picture

Aid donors are often maligned for bureaucratic procedures, a focus on short-term results at the expense of longer-term, riskier institutional change, and a technical, managerial approach to aid with insufficient focus on context, power and politics. Are these institutional barriers insurmountable? Can aid agencies create an enabling environment to think and work politically? 

Tom WingfieldTom Wingfield (top) and Pete Vowles (bottom) from DFID’s new ‘Better Delivery Taskforce’ have been trying to do just that. Here’s where they’ve got to.

For the past year DFID has been focussing on these issues and how we can both guard taxpayer’s money and have transformational impact in the countries where we work. The result has been the introduction of a comprehensive set of reforms targeting our process, capability and culture. Pete VowlesThis is about creating the conditions that allow us to better address the underlying causes of poverty and conflict, and respond effectively to the post-2015 agenda. At the heart of the reform is a revamp of DFID’s operating framework (ie the rules and principles which govern our work). Known as the ‘Smart Rules’, it can be downloaded here.

Like any institutional reform, this is a long term change process.  The next 12 months provide a real opportunity to strengthen our partnerships with a wide range of partners and enhance our collective effectiveness.

The Accountability Lab: Does Money Pervert Incentives?

Roxanne Bauer's picture
Which is more important to development: systemic change or small-scale projects? Which has a greater impact: money or social capital?  Most people responding to these questions are tempted to say systemic change and material resources are the most important factors in lifting people out of poverty. 

However, others working in the development sector, like Blair Glencorse of Accountability Lab, argue that money can actually pervert incentives. He states, "all of our projects are very small-scale [...] but the emphasis is on financial resources actually being less valuable than some other resources like intellectual capital, relationships, networks." 

Accountability Lab believes that making power-holders accountable leads to more responsible decisions and actions. In turn, resources are used more efficiently and expectations for further reform are generated, ensuring continued demand for accountability. This is not a clear-cut process, and it is often beset by difficulty. Sudden or massive increases in funding for certain sectors can negatively impact the process and do not lead to lasting accountability of power-holders. 

Watch the video and let us know if you agree! 
Does Money Pervert Incentives?

The Things We Do: How (not What) Movies Inspire Us

Roxanne Bauer's picture

At the basis of communication and public policy are assumptions about human beings- their rationality or irrationality, their foibles, wants and preferences. A lot depends on whether these assumptions are correct. In this feature, we bring you fascinating examples of human behavior from across the globe.

A recent article in The New York Times, “Divining Why One Film Spurs Activism, While Others Falter” highlights the work of Participant Media, an entertainment company that produces film, television, publishing and digital content that inspires social change. According to Participant Media’s website, the company “launches campaigns that bring together government entities, foundations, schools, and others to raise awareness and drive people to take action on issues from each film or television show.” 

But all of this begs the question: are these films successful in doing what they set out to do? Do people learn from the films and change their ways?  What pushes us beyond social media activism to stand up and do something about our outrage?

When field studies diverge from lab experiments: the case of incentivized blood donations: Guest post by Mario Macis

Do economic incentives crowd out individuals’ intrinsic motivation for certain activities that are performed in the absence of explicit rewards, such as volunteering in soup kitchens, recycling, or giving blood? This is an important question with implications for public policy and has been explored on Development Impact with a number of recent posts (here is the latest one from Jed).

What makes bureaucracies work better? Lessons from the Nigerian Civil Service

Markus Goldstein's picture
Given Jed's post last week on thinking through performance incentives for health workers, and the fact that the World Bank is in the throes of a reform process itself, a fascinating new paper from Imran Rasul and Daniel Rogger on autonomy and performance based incentives in Nigeria gives us some other food for thought.   In a nutshell, Rasul and Rogger f

The Legislator’s Dilemma: Following or Moving against the Tide of Perverse Incentives

Fletcher Tembo's picture
Listening to an expert discussion of the role of elected representatives in social accountability interventions at a recent event hosted by the Mwananchi Governance Programme and CIVICUS in Johannesburg on 16th May 2013, I was reminded of this quote by Joe Khamisi, a former Kenyan MP:

“Save, you may not see Parliament again”, one two-term Member liked to tell us.  In many cases non-performers with deep pockets are preferred than stingy doers. “As much as possible, avoid your constituents in the first three years and show up only towards the last half of your term, with plenty of money!”

In response, a Member of Parliament (MP) from one of the countries where Mwananchi works said, “You need to put premium on leadership”. In other words, we should not expect leaders to deliver the change we want if society encourages them to pursue perverse incentives to attain and remain in office, and to achieve solutions to collective action problems. 

Looking at the backgrounds of MPs in many countries in Africa, you find that some MPs have been activists in civil society, respected civil servants or faith leaders, often suggesting that things would be very different if it was them that were in office. This is a clear case of a common African saying ‘one finger forwards, four fingers backwards,’ reminding us how easy it is to criticise without examining ourselves. This is why it should not be surprising that again and again we find that when the ‘self-imagined’ leaders get into public office they are equally caught up in the quagmire of perverse incentives as their predecessors.

Do financial incentives undermine the motivation of public sector workers? Maybe, but where is the evidence from the field?

Jed Friedman's picture
These past weeks I’ve visited several southern African nations to assist on-going evaluations of health sector pay-for-performance reforms. It’s been a whirlwind of government meetings, field trips, and periods of data crunching. We’ve made good progress and also discovered roadblocks – in other words business as usual in this line of work. One qualitative data point has stayed with me throughout these weeks, the paraphrased words of one clinic worker: “I like this new program because it makes me feel that the people in charge of the system care about us.”

Caution when applying impact evaluation lessons across contexts: the case of financial incentives for health workers

Jed Friedman's picture

These past few weeks I’ve been immersed in reviews of health systems research proposals and it’s fascinating to see the common themes that emerge from each round of proposals as well as the literature cited to justify these themes as worthy of funding.

The Future of Driving and Finding the Right Incentives for Behavior Change

Julie Babinard's picture

What would blogs be good for if it were not for their intent on steering a bit of controversy?
So here it is… I do not believe that behavior change interventions can effect lasting change in people’s travel patterns unless real choices are available to them within the local context.