| Abstract: |
We conduct a field experiment with 1,300 participants in India to measure
whether individuals save more when information about their savings is
regularly shared with another member of their village (a “monitor”). We focus
on whether the monitor's effectiveness depends on her social network position,
as central monitors may be better able to disseminate information, and more
proximate monitors may be more likely to pass information to individuals who
interact with the saver most frequently. In 30 villages, we randomly assign
monitors to a subset of savers. An average monitor increases total savings by
35%. Increasing the monitor’s network centrality by one standard deviation
increases savings by 14%, and increasing proximity from social distance three
to two increases savings by 16%. Supporting the information-based mechanism,
63% of monitors report telling others about the saver’s progress. Further,
over a year later, villagers are more likely to know if the saver exceeded her
goal and to think that the saver is responsible if the saver was randomly
assigned to a more central monitor. We also provide evidence that the increase
in savings persists over a year after the intervention’s end, and that
monitored savers can better respond to shocks. In the remaining 30 villages,
savers choose their own monitors. We find that savers choose monitors who are
both proximate and central in the network. Finally, we find evidence of
spillovers from monitored savers onto their non-monitored friends, suggesting
another channel through which social networks influence savings decisions. |