81363 enGender Impact: The World Bank’s Gender Impact Evaluation Database Harnessing Emotional Connections to Improve Financial Decisions: Evaluating the Impact of Financial Education in Mainstream Media Author(s) Gunhild Berg, Bilal Zia Contact bzia@worldbank.org Country South Africa Organizing Theme Economic opportunities and Access to Assets, Voice and Agency Status Completed Intervention Category Information Intervention Sector Finance and Private Sector Development This paper exploits the emotional connections and viewer attentiveness of mainstream media to evaluate the economic impact of financial education messages on debt management delivered through a popular television soap opera in South Africa. The study uses a symmetric encouragement design to compare outcomes of individuals who were randomly assigned to watch a soap opera with financial messages, “Scandal!” to those of individuals who were invited to watch a similar soap opera without financial messages, “Muvhango.” Both shows overlapped in evening primetime and had similar past viewership profiles. The financial storyline spanned two months and featured one of the leading characters of the show borrowing excessively and irresponsibly through hire- Abstract purchase, gambling, and ending up in financial distress; and eventually seeking help to find her way out. Two intermediate and one final follow-up surveys were conducted as part of the study. The analysis finds individuals assigned to watch Scandal had significantly higher financial knowledge of the issues highlighted in the soap opera storyline, in particular messages delivered by the leading character. On behavior, Scandal viewers were almost twice more likely to borrow from formal sources, less likely to engage in gambling, and less prone to enter hire purchase agreements. Messages promoting a national debt mediation helpline delivered by an external character did not sustain traction beyond immediate interest. Three qualitative focus groups highlight the importance of emotional connections with the leading character in motivating behavior change. Gender Connection Gender Informed Analysis Gender Outcomes Gender disaggregated access to credit, savings IE Design Random encouragement design The study worked with the popular television show, Scandal, in South Africa to incorporate a story line featuring a character who borrows excessively. The story line then examines Intervention how she gets out of her debt trap. The treatment group was financially encouraged to watch the show. The control group was financially encouraged to watch a show that did not include a storyline about personal finance. Intervention Period The story timeline was during February - March 2012 Last updated: 14 August 2013 1 enGender Impact: The World Bank’s Gender Impact Evaluation Database 1031 individuals were chosen and randomized into treatment and control. The Sample population randomization was no stratified. The treated group were encouraged through financial incentives to watch the treated TV Comparison conditions show while the comparison group was encouraged to watch a different show that ran at the same time. Unit of analysis Individual Level December 2011 to December 2012; originally participants were called every 3-4 weeks for 3 Evaluation Period months. The vast majority of individuals did in fact watch the show they were incentivized to watch. There are significant improvements in content specific financial knowledge (4.5 p.p. increase) and no differences in knowledge of financial concepts that were not included in the storyline. The intervention leads to a significant increase in the likelihood of borrowing through formal channels (22% vs. 13% in the control group) and a greater likelihood to Results borrow for productive purposes such as investment in durable goods and vehicles. The increase in borrowing is completely driven by men. There was also a reducing of gambling which is a theme included in the soap opera. Also the South African National Debt Mediation Association was prominently featured at the end of shows. There was a significant increase to calls to the Association right after the first show, but memory of the association or debt counselors did not persist over time. It is very difficult to get a proper comparison group because it is impossible to restrict a Primary study limitations group from watching the show since it is nationally televised. Funding Source World Bank Fussia Trust Fund on Financial Literacy Berg, G., & Zia, B. (2013). Harnessing emotional connections to improve financial Reference(s) decisions: evaluating the impact of financial education in mainstream media. World Bank Policy Research Working Paper, (6407). Link to Studies http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2248477 Microdata Last updated: 14 August 2013 2