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Type | Journal Article |
Scope | Discipline-based scholarship |
Title | Demand and supply of infrequent payments as a commitment device: evidence from Kenya |
Organization Unit | |
Authors |
|
Item Subtype | Original Work |
Refereed | Yes |
Status | Published in final form |
Language |
|
Journal Title | American Economic Review |
Publisher | American Economic Association |
Geographical Reach | international |
ISSN | 0002-8282 |
Volume | 109 |
Number | 2 |
Page Range | 523 - 555 |
Date | 2019 |
Abstract Text | Despite extensive evidence that preferences are often time-inconsistent, there is only scarce evidence of willingness to pay for commitment. Infrequent payments for frequently provided goods and services are a common feature of many markets and they may naturally provide commitment to save for lumpy expenses. Multiple experiments in the Kenyan dairy sector show that: (i) farmers are willing to incur sizable costs to receive infrequent payments as a commitment device, (ii) poor contract enforcement, however, limits competition among buyers in the supply of infrequent payments. We then present a model of demand and supply of infrequent payments and test its additional predictions. |
Free access at | DOI |
Official URL | https://www.aeaweb.org/articles?id=10.1257/aer.20180281 |
Digital Object Identifier | 10.1257/aer.20180281 |
Other Identification Number | merlin-id:17504 |
PDF File | Download from ZORA |
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Keywords | Economics and Econometrics |