Persistent effects of temporary incentives: Evidence from a nationwide health insurance experiment

Aurélien Baillon, Joseph Capuno, Owen O'Donnell, Carlos Antonio Tan, Kim van Wilgenburg*

*Corresponding author for this work

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Temporary incentives are offered in anticipation of persistent effects that are seldom estimated. We use a nationwide randomized experiment in the Philippines to estimate effects of two incentives for health insurance three years after their withdrawal. We find that both temporary incentives had persistent effects on enrollment. A premium subsidy had a small but highly persistent effect. Application assistance offered to those initially unresponsive to the subsidy had a much larger but less persistent effect. The subsidy persuaded those with higher initial stated willingness to pay to enroll and keep enrolling. The offer of application assistance to initial non-compliers with the subsidy achieved a larger immediate effect by drawing in those who stated they valued insurance less and were less likely to re-enroll when the incentives were withdrawn.

Original languageEnglish
Article number102580
JournalJournal of Health Economics
Early online date24 Dec 2021
Publication statusPublished - Jan 2022

Bibliographical note

JEL Classification: C93, I13

We thank the Editor (Kosali Simon), two reviewers, Wendy Janssens, Teresa Molina and participants of various conferences and seminars for comments. Thanks to Kayleen Calicdan for research assistance. We are grateful to the European Union (FP7 program) for grant HEALTH-F2–2009–223166: Health Equity and Financial Protection in Asia (HEFPA) that funded the original experiment and to the World Bank for funding the follow-up (Daisy III) survey. The research of Aurélien Baillon is made possible by a Vidi grant of the Netherlands Organization for Scientific Research. Joseph Capuno and Owen O'Donnell are supported by the Swiss Agency for Development and Cooperation / National Science Foundation Programme for Research on Global Issues for Development through grant 400640_160374: Inclusive social protection for chronic health problems (PI: Jürgen Maurer). The experiment was registered ex-post on the AEA registry for social science experiments AEARCTR-0004977.

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