Applied Microeconomics seminar - Anna Tompsett

Applied Microeconomics seminar with Anna Tompsett, Stockholm University

Title: “Time is not money: an experiment with community contribution requirements in cash and labour.”

Abstract 
Community contribution requirements are a ubiquitous but understudied feature of projects to provide local public goods in developing countries. A randomized experiment in rural Bangladesh shows that cash contribution requirements strongly reduce take-up and impact of safe drinking water infrastructure projects, compared to a contribution waiver. Labour contribution requirements do not, despite having similar value when priced at the market wage, because most households value their time below the market wage and because labour contributions appear less costly to coordinate. Neither contribution requirement increases cost-effectiveness once we account for coordination and monitoring costs, undermining a central rationale for their imposition.