research

We examine the impact of incentives on intrinsic motivation after their removal. We follow up with parents three years after exposure to a bracelet incentive given to children upon timely vaccination in Sierra Leone. We leverage the design of an experiment under which clinics were randomly assigned to either offer incentives or not. Since only parents who had a newborn at the time were eligible, we also exploit individual variation in exposure within clinics. First, we find that eligibility to an incentive for an earlier child reduces parents' motivation to vaccinate their subsequent child on time, with decreases of 5 to 11 percent in the number of timely visits compared to unexposed parents. There are no impacts on vaccination rates by 15 months of age, suggesting parents delay vaccination, but do not abstain. Second, parents living in incentive communities who were ineligible at the time are unaffected, ruling out that results are driven by changes in community norms or clinic practices. Third, incentives that focus parents' attention on caring for their child's health do not lead to adverse effects. Together, our results suggest that incentives that shift parents' attention to an external reward, can crowd-out intrinsic motivation and negatively impact behaviors once removed.

Rationing policies are frequently implemented due to equity concerns. We study whether equitable-exposure rationing rules deliver equal economic impacts in the context of the 2021-2023 power crisis in South Africa. We leverage shocks to outage intensity and a rotational assignment system to generate quasi-random variation in electricity outage exposure, and we combine detailed hour-level outages with geocoded transactions data from a leading payment platform in Cape Town. Although we find that aggregate daily sales do not change on outage days, there is substantial heterogeneity across the firm distribution. Revenue is reallocated through consumers substituting between firms: baseline high-performing firms able to invest in defensive technology capture the spending displaced from their competitors, gaining roughly nine percent in daily sales while the latter lose a similar share. Unequal effects are amplified when firms are able to anticipate electricity outages. The results suggest the impacts of rationing are not equal despite equitable exposure.