Poverty, Aspirations, and the Economics of Hope: A Framework for Study with Preliminary Results from the Oaxaca Hope Project

• Development Workshop

Date and Location

Monday, May 16, 2016, 4:10 PM - 5:30 PM
ARE Library Conference Room, 4101 Social Sciences and Humanities

Abstract

We create a framework for understanding the role of hope and aspirations in economic development and give preliminary experimental results from a field project in Oaxaca, Mexico carried out in this framework. We review the literature on hope from philosophy, theology, psychology, and its relationship to emerging work on aspirations in development economics. We create an economic model of hope based on recent psychology literature that understands hope as a function of aspirations, agency, and pathways. Our model illustrates the role hope can play in the realization of positive effects from development interventions and how these effects emerge from interactions with the three constituent elements of hope. By clarifying definitions and relationships among these concepts and by leveraging relevant work from other disciplines, we aim to create a framework within which economists can engage in rigorous empirical and experimental work that seeks to better understand the role of hope in economic development. In our early experimental results suggest that a hope intervention among 601 microfinance borrowers raised aspirations approximately a quarter of a standard deviation, significantly raised a hope index among the treated subjects, and had positive but statistically insignificant results on enterprise performance.