The final panel of the day modeled how the educational mission of IMFTI might take many forms: academic lecture, episodic entertainment oriented around humor, or impassioned call to action from the perspective of non-governmental advocacy. Despite some technical difficulties, the final trio of papers of the day was ably moderated by IMTFI stalwart Scott Mainwaring, an HCI researcher now based in Portland who has had a leading role in a number of UCI think tanks.
"Risk Preferences, Time Preferences, and Willingness-to-Pay with Mobile Money versus Cash in Bangladesh" was presented by Jonathan Morduch of NYU, but he gave credit to his NYU colleague Jean Lee and to two other co-authors. As one of the authors who created Portfolios of the Poor, Morduch has maintained a high scholarly profile on issues of financial inclusion. In his talk at IMTFI he emphasized "new ways of thinking through new ways that people spend money," including new approaches to risk preferences, time preferences, and models for willingness to pay. Although his study focused on the highly successful electronic currency efforts of bKash, he wanted to account for “monetary ecologies” that might be more complex. He also aimed to go beyond existing US research on attitudes about cards vs. cash to understand how mobile phone currency might be different from traditional currency for citizens of a developing nation.
He prefaced his talk with some historical background about bKash, which was founded in 2011 by BRAC Bank and has counted IFC (International Finance Corporation) and the Gates Foundation among its investors. It has garnered some impressive statistics, including about 14 million subscribers and 105,000 agent points that allow the company to offer both money transfer and mobile wallet services. Sold and advertised as a payment platform – with advertisements featuring students, garment workers, and other economic actors -- Morduch argues that bKash functions in monetary ecologies of behaviors, resources, services, and products.
Morduch's team poses a significant question drawn from the IMTFI's own calls for proposals: "Does the digitization of money dematerialize the symbolism and physicality of money, and does it have consequences for decision-making involving spending and saving? In other words, for those in Bangladesh, does 1 Tk in cash equal 1 Tk in mobile money?
Morduch notes that The Social Meaning of Money by Viviana A. Zelizer makes the argument that money depends on who earns it and how it is earned, so that different kinds of money are spent differently. For example, money on mobile a phone sent from daughter working in a garment factory may be differentiated from money in cash derived from farm work by those remaining in rural life. He pointed to other work in the US about credit cards vs. cash and observed that the use of this research in mobile money studies may obscure an important functional difference, in that such cards decouple the moment of spending from the moment of payment and thus involve notions of liquidity and the nature of credit. Such currency functions as "play money," as Priya Raghubir and Joydeep Srivastava assert in their influential article "Monopoly Money: The Effect of Payment Coupling and Form on Spending Behavior," which examines how much experimental subjects were willing to pay for nine items on a menu without prices. By adding a credit card logo to the menu, researchers noted behavior changes, just as a study of how $50 of gift scrip vs. the same amount of cash for use at a grocery outlet might influence how potential customers might choose items in favor of expensive soups over cheaper soups or expensive pens over less expensive ones in a phenomena that could be characterized as "spending more when not spending."
Researchers focused on the Gaibandha District in the Rangpur Division in Bangladesh near the Indian border. The country has a low rate of food consumption, which is worsened by a famine season or "monga" condition. Working with the NGO Gana Unnayan Kendra (GUK), which helps women to become garment workers and places them in jobs in the capital Dhaka, researchers also had to account for seasonal variability in incomes. Morduch's team was interested in possible unexpected effects of remittances, if mobile money was considered dematerialized and not weighed with same consideration as cash money. Using Raghubir and Srivastava's research with the monopoly money paradigm, researchers wanted to look at how a different context and time might shape risk preferences. The sample studies was derived from families sending migrants to Dhaka, and the methodology was intended to account for the impacts of gender, class, occupation, and age. By looking at risk preferences in work pioneered decades ago about sets of gambles that might be considered analogous to bets placed on head flipping, researchers can look at how subjects might choose a safer lower yield bet (such as 33/33) in comparison to a more risky tempting one (such as 0/95). At this point they have completed stages for recruitment and consent, baseline surveys, time preferences, and willingness to pay.
"Mobile Money Financial Literacy via Television Comedy" by Andrew Crawford of Monash University looked at mobile money in Cambodia in the context of financial education campaigns rather than just at the uptake of a particular service, in this case Wing. Crawford opened by reminding the audience that the financial system had been destroyed by the Khmer Rouge, that US dollars had been used for a period of time afterwards. Although there were micro finance competitors, Wing -- like M-PESA -- "flows through the economy," and digital currency circulates with loan payments, money transfers, payroll, multi-currency conversion, e-commerce, ATM cards, and deposits. Nonetheless, financial policy makers were well aware of the problems with mobile money observed by researchers, including the fact that it was expensive to conduct financial education, curricula were slow to rollout, and language and lack of interest issues could stymie retaining and applying information. (At this point he noted that boredom from conventional presentations like own PowerPoint presentation could cause little to be remembered from his talk.)
Crawford argued that TV comedy could provide a viable alternative to conventional public information campaigns, given that 98% of people in the country watch television and that penetration is particularly high, because many people also watch shows on buses, where corporate synergies between broadcasters, such as CTN and CNC, and bus companies present opportunities for the Cambodia Microfinance Association and ADA Luxembourg. Crawford showed several episodes with a couple who progress from very small businesses in barbering and food service to larger enterprises that require more capital and financial planning. As the relationship matures, along with their banking and credit skills, his hair gradually becomes tamed and his affect becomes less outrageous.
Crawford's research team wanted to find out if there was any impact in both short-term and the long-term financial literacy from watching the show. Furthermore, can any impact measured in focus groups be extrapolated across wider populations? The group focused on garment factory workers, because of a desire to focus on women, who represented about 400,000 workers, providing labor for major brands, who were paid in cash with no method to save and thus often remit to family. In the past the transfer of money was effected via motorbikes with locked boxes, which was inefficient. Subjects were usually young (in Crawford's opinion often too young to be working full time) and watchers of TV. The methodology involved three groups: 1) Treatment 1, which experienced generic financial education with a five-minute slide presentation video, 2) Treatment 2, which experienced financial education entertainment with a five-minute comedy show, and 3) Control Group, which experienced a generic comedy show and received no financial literacy education. Crawford explained that he wanted to combine quantitative research from surveys with qualitative research that involved 1-on-1 interviews with researchers and focus groups after each screening. Follow up sessions conducted after 3 months to test long term effectiveness Phone surveys – CEO of Wing owns TV station, wife is host of Cambodia’s Next Top Model Country-wide changes – New mobile money accounts, demographics of new clients, general mobile savings trends Novelty Background, Effectiveness, Share results – final research paper
"The Formal Disguise: Financial Inclusion Among Flexible Workers and the Self-Employed" by Ana Echeverry and Coppelia Herrán of Inspira Lab focused on Colombia and the tough competition faced by workers often forced to pay-to-work in positions lacking any social safety net for health and education targeting an unskilled or low skilled labor force, in fields that include outsourced textile production and manufacturing, food and restaurant services, retail and sales, car maintenance and services, and fitness and beauty, where workers often must pay a fee for using the commercial space and bring their own equipment and supplies. Such workers must often even pay fees for keeping the place of employment clean, and half of their wages may go to the owner of the commercial space. Unlike the "temptation costs" described in the previous panel, on this panel Echeverry and Herrán depict highly disciplined workers willing to invest in the site of employment. Nonetheless these workers may be extremely disenfranchised.
This team before had worked with "bottom of the pyramid" workers outside of the formal system, but those adopting what Echeverry and Herrán call "the formal disguise" in many ways are just as desperate as those they had studied before who were using technology through gaming networks and "betting on chance." Among these barely legal formal workers 43.3% were self-employed, 46.4% earned below the minimum wage, and 50% lacked social security coverage. The team focused on 24 informants and took a direct approach in public spaces and via referrals with video ethnography and semi-structured interviews trying to the understand the scope of problem. By interrogating "different views and perspectives," they characterized their work as "exploratory research" about contrasting behaviors and identifying underlying factors driving behaviors, such as values, attitudes, and perceptions.
The group focused on identifying those with contrasting behaviors with a 360 degree view of human personalities that included the careful planner, the risk taker, the person ending a career, the formally trained worker, the submissive economic actor, the spontaneous personality, the risk averse, the independent, the apprentice, the tech-enthusiast, and the technology averse. By identifying common patterns among diverse people, researchers hoped to identify common strategies and attitudes reflected across personality types. Informants talked about work, money, and risk with researchers and described an environment of "in and out mobility" instead of "upward mobility." Such workers depended on using word of mouth and referrals for finding jobs, reliance on social networking, trust, honesty, and willingness to work. Such workers constantly battled the fact that temporary employment makes it difficult to establish relationships.
This population of vulnerable workers seemed to be avoiding account deductions. They were not using mobile money, because they realized that the bank takes money, and they also wanted to continue staying below the "fiscal radar" to reduce costs. Researchers observed a pattern of withdrawing all money on payday and a complicated mental logic in regards to risk. Their subjects were willing to make certain kinds of investments, even if they did not map onto the conventional architecture of financial inclusion. These workers might expend pocket money to get better healthcare or divert savings into building home additions for future rental as a retirement strategy. They might funnel saving towards equipment with hopes of enhanced employment opportunity, but more living those savings went toward financing the inevitable with planning for their own mortality. In other words, many had little hesitation about shouldering the costs of funeral insurance – in light of their knowledge that this is an event that they know will happen. Unlike the relatively transparent investment schemes in funeral insurance, Echeverry bemoaned the fact that 90% of the people subsidized 10% of those who used government services, which fostered a further lack of trust in the system. Instead workers assumed all risks and operational costs as a consequence of flexible and emerging contracts. Often workers had to splurge on costly training courses as well. Echeverry opened by likening many of the country's educational investments to DeVry-style extraction.
Echeverry noted that children become a priority when people are so exhausted and desperate. The parents researchers studied were willing to do anything for their offspring. They also were extremely dependent on communication networks, especially those that involve access to word-of-mouth information. Researchers marveled at the fact that most people in the population they studied had smart phones, which were a "tool for the job." In fact,"many of them had phones better than ours." To stay competitive and reduce costs, many opted out of mandatory requirements. The Inspira team described them as "quite organized," and asserted that "most of them do financial planning." For such labor-intensive poverty vulnerability the "concern isn’t healthcare but not being able to work." Thus most can barely afford mandatory insurance services, which would come to about 15% of their income. Rather than rely on a risky calculus around public health and modern medicine, they were more likely to focus on "protecting oneself from risks" in other ways, including by relying on "religious elements," such as obeisance to the patron of jobs and workers. Echeverry said that she observed similar behavior in her own nephew around the game Magic the Gathering, which is likewise about rules for "special powers. These workers in casual labor markets feel compelled to "insure yourself with saints."
Because of government turnover and policy reinvention, researchers have had to delay the implementation phase of research. Their current action items for lawmakers emphasize an agenda for worker-centered change, which includes the following elements: 1) Offer incentives to compensate for social protection benefits, 2) Provide social dialogue tools that bring together dispersed workers and employers, 3) Offer tools and services that ensure a better future or living conditions for children, 4) Leverage referrals and social networks into employment services, 5) Make loans or credit eligibility visible to the user, 6) Recommend related products or services into the experience of payroll accounts, such as insurance or investments, 7) Promote add-on complements to mandatory insurance at a minimum, 8) Structural social security reform to include lowering costs through customization, and 9) Promote alternative investments.
To emphasize pragmatic approaches and direct attention to new opportunities for the business sector, the Inspira research team also catalogued a number of "innovation opportunities" that follow from worker-centered principles. First, researchers discouraged companies from thinking about desktop computing as a platform for Internet and emphasized analogies to social network sites and mobile applications. For such workers digital recommendations serve a number of purposes, and mobile technologies can also congregate dispersed, independent, and flexible workers to facilitate exchange of services and spread opportunities. This approach would help workers make informed decisions, and stay up-to-date on legal, insurance and financial topics. Second, in thinking about money matters, researchers urged financial service providers to offer savings incentives toward specific goals. For example, in explaining eligibility for loans, allow prospective borrowers to visualize pre approved loans. Third, companies could develop micro-insurance to provide alternative products that personalize one-sized-fits-all mandatory insurance or respond to specific needs that might be constantly present in workers' imaginations, such as eldercare or high school as expenditures. Fourth, innovations could emphasize closing the loopholes created by flexible labor laws designed to help Colombians to become competitive in the global market. Mobile technologies can help workers meet in a place for business relationships, social dialogue, and financial and risk management services.
Listening to Echeverry, I was reminded of the work of Lilly Irani about the flexible workforce that provides so-called "Mechanical Turk" services too difficult for automated computerized AI to be tasked to do. Irani has had technology workers rate employers to turn the table on systems that before could only rate workers.