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Better together? Group incentives and the demand for prevention

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  • Lagarde, Mylène
  • Riumallo Herl, Carlos

Abstract

In a field experiment with 400 groups of informal entrepreneurs in El Salvador, we compare the impact of group incentives (linked to compliance of all members) to equivalent individual ones to encourage cardiovascular check-ups. We test two incentive designs: small rewards and lotteries. Group incentives are as effective as individual ones at increasing demand for prevention, but, unlike individual incentives, they fail to target those with potentially higher health risks. The equal effectiveness of group incentives is linked to more communication, coordination between members and, to some extent, peer pressure. These social dynamics contribute to reduce uncertainty about other group members’ decisions and enhance the perceived net benefit of prevention. Although the preventive check-ups do not induce short-term lifestyle changes, they substantially increase the detection of new risk factors, making all incentives highly cost-effective interventions in this population.

Suggested Citation

  • Lagarde, Mylène & Riumallo Herl, Carlos, 2025. "Better together? Group incentives and the demand for prevention," LSE Research Online Documents on Economics 125349, London School of Economics and Political Science, LSE Library.
  • Handle: RePEc:ehl:lserod:125349
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    File URL: http://eprints.lse.ac.uk/125349/
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    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior

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