No abstract

This article examines one reason why individuals develop and maintain local-level financial savings organizations known as rotating savings and credit organizations, or Roscas. Economic theories suggest that individuals form Roscas to finance the purchase of a lumpy durable good, in response to intrahousehold conflict over savings, or to provide themselves with insurance. The article proposes an additional hypothesis for Rosca participation: saving requires discipline, and some Roscas may be formed to provide a collective mechanism for commitment in the presence of time-inconsistent preferences. Data from 70 Roscas located in western Kenya indicate that the commitment hypothesis is plausible and broadly consistent with the design and patterns of participation in these Roscas. As many Rosca participants put it, “You can’t save alone.”

In this article we examine how information problems can cause agency slippages and lead to governance failures in nonprofit organizations. Drawing on the principal-agent literature, we provide a theoretical account of an institutional mechanism, namely, voluntary regulation programs, to mitigate such slippages. These programs seek to impose obligations on their participants regarding internal governance and use of resources. By joining these programs, nonprofit organizations seek to differentiate themselves from nonparticipants and signal to their principals that they are deploying resources as per the organizational mandate. If principals are assured that agency slippages are lower in program participants, they might be more likely to provide the participants with resources to deliver goods and services to their target populations. However, regulatory programs for nonprofit organizations are of variable quality and, in some cases, could be designed to obscure rather than reveal information. We outline an analytical framework to differentiate the credible clubs from the "charity washes." A focus on the institutional architecture of these programs can help to predict their efficacy in reducing agency problems.

HighlightsWe use surveys of husbands and wives in Tanzania to explore rural household decision-making.We find perceptions of household decision-making authority differ depending on the spouse asked.Factors associated with a wife’s authority include age, education, health, children, and labor hours.The allocation of intra-household authority also varies across thirteen different decision questions.A lack of “intra-household accord” over authority may be a barrier to empowerment efforts.

Nonprofit accountability, Collective action, Voluntary programs, Voluntary clubs, Self-regulation, Certification,