Felipe Dizon, University of California, Davis
Does Financial Inclusion Exclude? The Effect of Access to Savings on Informal Risk-Sharing in Kenya
Date and Location
Monday, October 19, 2015, 4:10 PM - 5:30 PM
ARE Library Conference Room, 4101 Social Sciences and Humanities
In the absence of formal markets to manage risk and cope with shocks, individuals often rely on mutual interpersonal transfers, otherwise known as informal risk-sharing arrangements (IRSAs). Theoretically, it is unclear whether access to a microsavings program complements or substitutes existing IRSAs. We estimate the effect of access to savings on bilateral IRSAs using data from Kisumu, Kenya. Among a sample of 627 vulnerable women, we randomly assign a savings intervention that included setting saving goals, weekly SMS reminders, and a labeled mobile money savings account. We find that the savings intervention has a negative effect on informal risk-sharing, consistent with a model wherein access to savings exacerbates limited commitment in IRSAs. Moreover, the negative effect is smaller for pairs where both receive treatment, as opposed to only one, and for individuals who have a larger risk-sharing network, who seem to be increasing risk-sharing with other connections. Overall, our results suggest that we should carefully consider the negative spillovers of microsavings programs on risk-sharing connections when evaluating welfare effects.
Subscribe to Upcoming Seminars
Individual seminar and workshop announcements are circulated via separate mailing lists. To subscribe, send an email to the relevant list:
- Click here to subscribe to the Departmental Seminars.
- Click here to subscribe to the Agricultural Economics Workshop.
- Click here to subscribe to the Development Workshop.
- Click here to subscribe to the Econometrics Seminars.
- Click here to subscribe to the Environmental and Resource Economics Workshop and the Environmental and Energy Economics Workshop.
Contact Us2116 Social Sciences and Humanities
University of California, Davis
One Shields Avenue
Davis, CA 95616
Main Office: 530-752-1515
Student Advising Services: 530-754-9536
DeLoach Conference Room: 530-752-2916
Main Conference Room: 530-754-1850