Timothée Demont: timothee.demont[at]univ-amu.fr
Eva Raiber: eva.raiber[at]univ-amu.fr
Differently to financial or material incentives, the strength of reputational incentives depends on the equilibrium level of contributions (Bénabou and Tirole, 2012). We test this prediction empirically in the context of a new deworming program that offers free treatment to 200,000 adults in Kenya. We randomize the introduction of two types of social signals in the form of colorful bracelets and ink applied to the thumb. The bracelets and ink allow adults to signal that they contributed to protecting their community from worms. Further, we exogenously vary the cost of deworming by assigning communities to different travel distances to treatment locations. Reduced form estimates show that (1) bracelets as signals significantly increase de worming take-up, outperforming a material incentive; (2) there is no detectable effect for the ink signal; (4) adults are highly sensitive to distance and both signaling treatments have a larger impact on take-up at far distances. We build a structural model that mirrors the theoretical framework provided by Bénabou and Tirole (2012) and explicitly model latent variables such as the private benefit of incentives, the visibility of the signals and the reputational returns to signaling. The model allows us to estimate counterfactuals in response to manipulations imfeasible to conduct in the experimental setting and investigate how aggregate shifts in the cost of deworming change the returns to signaling. Consistent with the theoretical predictions, we find that reputational returns increase at lower equilibrium take-up levels, and that the increase in reputational returns mitigates the negative impact of cost on treatment take-up. Of substantive policy importance, as individuals' willingness to walk increases at further walking distances, deworming treatment locations can be set up further apart and with the same number of locations larger geographic areas can be covered.