ETHIOPIAN DEVELOPMENT RESEARCH INSTITUTE

Aspirations and Well-being in Rural Ethiopia

Tanguy Bernard1, Stefan Dercon2, Kate Orkin3, and Alemayehu Seyoum Taffesse1

1International Food Policy Research Institute, 2 University of Oxford, 3 University of Cambridge

Towards what works in rural development in Ethiopia: Evidence on the impact of investments and policies

December 13th, 2013 Hilton Hotel, Addis Ababa

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Motivation Elements of the aspirations framework Aspirations project Field experiment – design and findings

Outline

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Conceptual – ‘opportunities’

Empirical – Why do the poor not ‘invest’?

Ethiopians and fatalism?

Focus 1 - ‘external circumstances’ and ‘opportunities’.

Low returns to investments; Unexploited opportunities due to lack of information or

knowledge; Social constraints;

Focus 2 - constraints associated with the manifested attributes of decision makers

Identity issues: sense of self; Psychological issues: impatience, commitment, and psychological

barriers

Aspirations failure perspective

Motivation – why aspirations

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Aspirations:

A desire or an ambition to achieve something An aim and implied effort to reach it A set of future-regarding preferences

Related concepts

Economics : Satisficing Psychology : Self-efficacy, locus of control Anthropology : Aspiration failures

Common elements

Goals and aspirations are important determinants of success; Evolution through time in response to circumstances; Role of social comparisons and learning from relevant others,

An individual-level yet culturally (collectively) determined attribute towards exploration of individual-group symbiosis

Elements of the Aspirations Perspective

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Elements of the Aspirations Perspective

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What are Aspirations?

Aspirations have two distinctive aspects:

• Future-oriented - are goals that can only be satisfied at some future time (differ from immediate gratifications);

• Motivators - are goals individuals are willing, in principle, to invest time, effort or money in to attain (different from idle daydreams and wishes)

Note: the ‘willingness to invest’ is ‘potential’, or ‘conditional’

Aspirations and expectations – preference vs. beliefs;

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Elements of the Aspirations Perspective

Why are aspirations important/useful?

Aspirations (or the capacity to aspire):

Reflect bounded rationality;

Are socially determined (social interaction);

Are distributed unevenly within communities.

Condition individual behaviour and well-being

Useful device in analysing and/or addressing poverty

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Conceptual Schema

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The “Aspirations” project

Step 1 – correlates of aspiration-related conceptsStep 2 – test and validate a measurement strategyStep 3 – assess validity of the “aspiration window” hypothesis

An experiment Exogenous shock to aspirations: Mini-documentaries of local

success stories screened to randomly selected individuals. Placebo: local TV show.

3 rounds of data• Baseline pre-treatment (Sept-Dec 2010)• Aspirations retest immediately after treatment• Follow-up (Mar-May 2011)

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On going experiment

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Observations

"Weak" treatment, but:

Documentaries affected aspirations, expectations, expenditure on children’s schooling, time allocation, savings behaviour, and hypothetical loan demand, perceptions more than the placebo even 6 months after treatment;

Direct and, even more visible, indirect (group) effects are detected – more of an aspiration window story rather than a role model one;

It is not obvious why some effects are direct (savings) while others are indirect (time allocation);

Further analysis; Expanding coverage – Malawi, Pakistan via IFPRI;

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