From Diagnosis to Treatment: A Large-Scale Field Experiment to Reduce Non-Payments for Water

Seminario Theory-Experimental

Arne Weiss

University of Mannheim

20-Sep-2021

seminar – 14:30

In a field experiment among 9,833 customers of the Namibian water utility, we implement interventions to reduce non-payments. The interventions are based on diagnostic surveys to identify key obstacles to payments. They address informational frictions and apply psychological commitment techniques to narrow the gap between customers’ willingness to pay and actual payments. Initially, payments increase by 30% to 61%, making the interventions highly cost-effective. While removing informational frictions has a lasting impact, the commitment techniques produce only short-term effects. We demonstrate the effectiveness and limitations of behavioral interventions in settings where heavy-handed tools, e.g., disconnecting non-payers, are difficult to implement.