Do Savings Mediate Changes in Adolescents' Future Orientation and Health-Related Outcomes? Findings From Randomized Experiment in Uganda

Abstract

Purpose This present study tests the proposition that an economic strengthening intervention for families caring for AIDS-orphaned adolescents would positively affect adolescent future orientation and psychosocial outcomes through increased asset-accumulation (in this case, by increasing family savings). Methods Using longitudinal data from the cluster-randomized experiment we ran generalized estimating equation (GEE) models with robust standard errors clustering on individual observations. To examine whether family savings mediate the effect of the intervention on adolescents’ future orientation and psychosocial outcomes, analyses were conducted in three steps: (1) testing the effect of intervention on mediator; (2) testing the effect of mediator on outcomes, controlling for the intervention; and (3) testing the significance of mediating effect using Sobel-Goodman method. Asymmetric confidence intervals for mediated effect were obtained through bootstrapping—to address the assumption of normal distribution. Results Results indicate that participation in a matched Child Savings Account program improved adolescents’ future orientation and psychosocial outcomes by reducing hopelessness, enhancing self-concept, and improving adolescents’ confidence about their educational plans. However, the positive intervention effect on adolescent future orientation and psychosocial outcomes was not transmitted through saving. In other words, participation in the matched Child Savings Account program improved adolescent future orientation and psychosocial outcomes regardless of its impact on reported savings. Conclusions Further research is necessary to understand exactly how participation in economic strengthening interventions, for example, those that employ matched Child Savings Accounts, shape adolescent future orientation and psychosocial outcomes: what, if not savings, transmits the treatment effect and how?

Effects of Financial Incentives on Saving Outcomes and Material Well‐Being: Evidence From a Randomized Controlled Trial in Uganda

“…Microsavings products-defined as small-deposit accounts tailored for low-income individuals and families-have shown great promise in increasing householdlevel investments, expenditures, and long-term asset accumulation, particularly among marginalized communities and individuals (including racial minorities and immigrants) in Western industrialized countries (Friedline, 2014;Huang et al, 2013;Sherraden, 2005) and increasingly in lower-and middle-income countries (LMICs) (Ashraf et al, 2003;Basargekar, 2015;Dupas & Robinson, 2009;Karimli & Ssewamala, 2015;Van Rooyen, Stewart, & De Wet, 2012). As a branch of microfinance, microsavings programs range in design, size, and structure.…”

Microfinance and savings among the poor: evidence from Bangladesh microfinance sector

“…Rapid financial development in the developing countries (Arestis and Demetriades 1997;Jalilian and Kirkpatrick 2002;Singh 1997) has raised the importance of savings both individual and macroeconomic levels (Demirguc-Kunt et al 2015; Gomes and Ribeiro 2015;Karimli and Ssewamala 2015;Leff and Sato 1975;Prina 2015;Ram 1982;Rüfe-nacht et al 2015;Van Auken and Horton 2015). However, the coverage of formal banking in the Least Developed Countries (LDCs) is still low.…”

Cost-Effectiveness of a Savings-Led Economic Empowerment Intervention for AIDS-Affected Adolescents in Uganda: Implications for Scale-up in Low-Resource Communities

“…In addition to the usual care condition, students in the intervention conditions, Bridges and Bridges Plus , received the following intervention components: 1) Financial Literacy (FL) workshops focused on asset building, future planning, family microenterprise development, and protection from risks; 2) mentors to reinforce learning and build optimism; 3) a Child Savings Account (CSA), from which matched savings could be used for secondary education, and microenterprise development. These components are described in earlier publications (7, 29, 30). The only difference between the two treatment arms, Bridges and Bridges Plus , was the rate of the financial incentive for saving (match rate) described earlier.…”

“…Moreover, the high prevalence of poverty, compounded by a lack of government safety nets (as in most SSA countries) and a lack of hope for the future can influence adolescents’ decisions on sexual risk taking resulting in increased HIV risk, and negatively impacting adolescents’ prospects to succeed in life. Yet most interventions for children and families in AIDS-impacted communities in SSA have primarily focused psychosocial services for children (6, 7, 18), giving less attention to the economic needs of adolescents and their families.…”

“…Given scarce economic resources, the SSA region needs interventions that are cost-effective, and scalable, with multidimensional benefits. Emerging evidence, from a series of randomized controlled trials (RCTs) in Uganda, indicates that an innovative saving-led economic empowerment intervention using incentivized financial savings focused on adolescents (hereafter, children matched savings accounts – CSAs), and directed towards specific purposes such as education and family micro-enterprise development, may be a viable approach to improving multidimensional wellbeing among orphaned and vulnerable adolescents (6, 7, 18-20). …”