What Are the Headwaters of Formal Savings? Experimental Evidence from Sri Lanka

• Michael Callen ^[3] ; Suresh de Mel ^[1] ; Craig McIntosh ^[3] ; Christopher Woodruff ^[2]
  1. [1] University of Peradeniya

     University of Peradeniya

     Sri Lanka

     
  2. [2] University of Oxford

     University of Oxford

     Oxford District, Reino Unido

     
  3. [3] University of California San Diego

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• Localización: Review of economic studies, ISSN 0034-6527, Vol. 86, Nº 6, 2019, págs. 2491-2529
• Idioma: inglés
• Texto completo no disponible (Saber más ...)
• Resumen

  • The world’s poor are seeing a rapid expansion in access to formal savings accounts. What is the source of savings when households are connected to a formal account? We combine a high-frequency panel survey spanning two and a half years with an experiment in which a Sri Lankan bank used mobile Point-of-Service (POS) terminals to collect deposits directly from households each week. We find that the headwaters of formal savings lie in sacrificed leisure time: households work more, and improved savings options generate an increase in labour effort in both self-employment and in the wage market. The results suggest that the labour allocation channel is an important mechanism linking savings opportunities to income.