Do%20Non%2DMonetary%20Prices%20Target%20the%20Poor%3F%20Evidence%20from%20a%20Field%20Experiment%20in%20India

Working Papers

Do Non-Monetary Prices Target the Poor? Evidence from a Field Experiment in India


CODE: IDB-WP-725
AUTHOR(s): Hoffmann, Bridget
PUBLISHED: September 2016
LANGUAGE: English
RELATED TOPICS: Poverty Reduction and Labor
DOWNLOAD FILE IN: English

Abstract:

This paper uses willingness to pay (WTP) data from a field experiment in Hyderabad, India in 2013 to determine whether non-monetary prices better target health products to the poor than monetary prices. Monetary WTP is increasing in income and non-monetary WTP is weakly decreasing in income. Household fixed effects in a pooled sample of monetary WTP and non-monetary WTP are used to compare the correlation of income and WTP across price types. It is found that non-monetary WTP falls relative to monetary WTP as income rises. Finally, a greater fraction of demand is comprised of the poor at non-monetary prices.

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