To Charge or Not to Charge: Evidence from a Health Products Experiment in Uganda

In a field experiment in Uganda, we find that demand after a free distribution of three health products is lower than after a sale distribution. This contrasts with work on insecticide-treated bed nets, highlighting the importance of product characteristics in determining pricing policy. We put forward a model to illustrate the potential tension between two important factors, learning and anchoring, and then test this model with three products selected specifically for their variation in the scope for learning. We find the rank order of shifts in demand matches with the theoretical prediction, although the differences are not statistically significant.


Issue Date:
May 22 2014
Publication Type:
Working or Discussion Paper
PURL Identifier:
http://purl.umn.edu/169540
Total Pages:
46
JEL Codes:
D11; D12; D83; I11; I18; O12
Note:
Updated version posted November 24, 2014.
Series Statement:
Economic Growth Center Discussion Paper
1041




 Record created 2017-04-01, last modified 2017-08-27

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