De Hoop, Thomas and Van Kempen, Luuk and Fort, Ricardo (2010): Do people invest in local public goods with long-term benefits: Experimental evidence from a shanty town in Peru.
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This paper discusses voluntary contributions to health education in a shanty town in Peru, using a new experimental setup to identify voluntary contributions to local public goods. The experiment enables individuals to contribute to a health education meeting facilitated by an NGO, which they know will only be organised if the cumulative investment level exceeds a certain threshold value. In contrast to expectations of aid distributors, individuals contributed a substantial amount of money, despite the long-term nature of the health benefits from health education. High discount rates only seem to have had a detrimental effect on investment in a poorer subsample. Results from a complementary experiment, which identifies donations to a nutrition program, suggest that positive beliefs about short-term benefits from health education in the form of learning effects have played an important role in the investment decision. The results indicate that channelling decision-making power about public good provision to beneficiaries not necessarily implies a crowding out of investment in local public goods with long-term benefits. Hence, particular attention is given to the potential role of cash transfers in the financing of local public goods.
|Item Type:||MPRA Paper|
|Original Title:||Do people invest in local public goods with long-term benefits: Experimental evidence from a shanty town in Peru|
|Keywords:||Health education, Field Experiment, Public Good, Peru|
|Subjects:||H - Public Economics > H4 - Publicly Provided Goods > H41 - Public Goods
C - Mathematical and Quantitative Methods > C9 - Design of Experiments > C93 - Field Experiments
I - Health, Education, and Welfare > I1 - Health
|Depositing User:||Thomas de Hoop|
|Date Deposited:||19. Oct 2010 08:01|
|Last Modified:||12. Feb 2013 02:00|
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