Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/97113
Authors: 
Karlan, Dean
Ratan, Aishwarya Lakshmi
Zinman, Jonathan
Year of Publication: 
2014
Series/Report no.: 
WIDER Working Paper 2014/078
Abstract: 
The poor can and do save, but often use formal or informal instruments that have high risk, high cost, and limited functionality. This could lead to undersaving compared to a world without market or behavioural frictions. Undersaving can have important welfare consequences: variable consumption, low resilience to shocks, and foregone profitable investments. We lay out five sets of constraints that may hinder the adoption and effective usage of savings products and services by the poor: transaction costs, lack of trust and regulatory barriers, information and knowledge gaps, social constraints, and behavioural biases. We discuss each in theory, and then summarize related empirical evidence, with a focus on recent field experiments. We then put forward key open areas for research and practice.
Subjects: 
poverty
randomized evaluation
savings
JEL: 
D12
D91
G21
O16
Document Type: 
Working Paper

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