The Future in Mind: Aspirations and Forward-Looking Behaviour in Rural Ethiopia

Abstract

Poor people often do not make investments, even when returns are high. One possible explanation is that they have low aspirations and form mental models of their future opportunities which ignore some options for investment. This paper reports on a field experiment to test this hypothesis in rural Ethiopia. Individuals were randomly invited to watch documentaries about people from similar communities who had succeeded in agriculture or business, without help from government or NGOs. A placebo group watched an Ethiopian entertainment programme and a control group were simply surveyed. In addition, the number of people invited was varied by village to assess the importance of peer effects in formation of aspirations. Six months after screening, aspirations had improved among treated individuals and did not change in the placebo or control groups. Treatment effects were larger for those with higher pre-treatment aspirations. We also find treatment effects on savings, use of credit, children's school enrolment and spending on children's schooling, suggesting that changes in aspirations can translate into changes in a range of forward-looking behaviours. There are also treatment effects on measures from psychology and sociology, including locus of control, which theory predicts should behave in similar ways to aspirations. Most effects are robust to corrections for multiple testing. Peer effects results in further impact on educational spending and induce more work and less leisure. The result that a one-hour documentary shown six months earlier induces actual behavioural change suggests a challenging, promising avenue for further research and poverty-related interventions.

Goals and Gaps: Educational Careers of Immigrant Children

“…These results are consistent with the existing literature. The importance of the first channel is in line with experimental evidence showing that raising aspirations through role models increases educational investment (Tanguy et al, 2014). Our result on teachers' recommendations aligns with the literature showing that teachers' expectations on students' performance play a crucial role in affecting educational choices.…”

Opportunities for higher education: the ten-year effects of conditional cash transfers on upper-secondary and tertiary enrollments

“…This effect is believed to be partly due to the required education information workshops and increased interaction with community leaders ( [12,33,26]. In these workshops, beneficiaries interact with community leaders and learn the importance of health and education.…”

“…Recent studies suggest three important sources for low aspirations. First, low-income households may suffer from psychological distress due to liquidity constraints [33,21]. Second, low aspirations can also be caused by limited or no exposure to positive role models in disadvantaged environments [14,17,23].…”

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“…For instance, viewing an image of a successful farmer may make farmers more ambitious and increase their aspirations, leading them to consider an additional set of investment options (Tanguy et al 2014). It may also aect their locus of control, by making them more aware of actions they themselves can take to increase yields.…”