Volunteerism or Fee-for-Service - Part two

Volunteerism or Fee-for-Service - Part two

In an earlier post, I suggested that the volunteer spirit was a perfectly good motivation for trainers to form groups, and then support groups once they have been formed, especially helping them through the thickets of proportional share-out. 

I am completely certain - based on what I have directly observed - that both volunteer and fee-for-service models can provide people with the motivation they need to keep forming and supporting savings groups. I am perplexed therefore by an attitude I keep running into that volunteerism isn’t sustainable, that it is indisputably a second-best choice, and that it won’t lead to high quality groups.

So, let me throw some more fuel on this fire. First, I just saw this article based on a study that showed that in a sample of 10,000 elderly Americans, those who were “selfless volunteers” lived longer. But, how relevant is that? Not very.

But that reminded me of meeting Zuleha, a trainer in Niger forming groups in a Plan program, a couple of years ago. She had been moved to fee-for-service status, and was more successful than most of her colleagues in getting groups to pay for her training. She also charged more: 25 CFA francs (5 US cents) per member per visit, instead of ten francs. 

I asked her what she would do if the groups stopped paying her. She flashed me a look that I later realized was sadness that we even had to talk about this. She said, Do you think I work for 25 francs? Even if they give me nothing, I’ll do the same work. I grew up in this village. If my relatives ask something of me, how can I refuse them?

Well, I know - that won’t change your mind if you are already convinced that money holds a privileged position in motivating people, and there is nothing further to learn about how fee-for-service compares as a source of motivaton with taking care of ones relatives or contributing what we can to our “village”. But if so, I’m with Zuleha: I’m sad that we are even having this discussion.

(Modified 25 October to make it clearer)


Reader Comments (2)

Dear Paul - I think you may have hit the nail on the head. Also, note a new study confirming your findings (though in the health area, not the SG area). Still, the findings are relevant and the third is interesting.

No margin, no mission? A Field Experiment on Incentives for Pro-Social Tasks by Nava Ashraf (HBS and NBER); Oriana Bandiera (LSE); Kelsey Jack (Tufts)(http://bit.ly/ukeVdS)

Here is the abstract: A substantial body of research investigates the design of incentives in firms, yet less is known about incentives in organizations that hire individuals to perform tasks with positive social spillovers. We conduct a field experiment in which agents hired by a public health organization are randomly allocated to four groups. Agents in the control group receive a standard volunteer contract often offered for this type of task, whereas agents in the three treatment groups receive small financial rewards, large financial rewards, and non-financial rewards, respectively. The analysis yields three main findings. First, non-financial rewards are more effective at eliciting effort than either financial rewards or the volunteer contract. The effect of financial rewards, both large and small, is orders of magnitude smaller and not significantly different from zero. Second, non-financial rewards elicit effort both by leveraging intrinsic motivation for the cause and by facilitating social comparison among agents. Third, contrary to existing laboratory evidence, financial incentives do not crowd out intrinsic motivation in this setting.


Tue, October 25, 2011 | Kim Wilson

It's probably got a lot to do with how the wife or husband in a poor household views a volunteer spending several hours a week on work that gains them kudos but doesn't help the maize to grow or buys a bar of soap. I am curious as to how many of us are volunteers and how effective we'd be (or be permitted to be by our families) if our 401 (K)s and other investments weren't nicely stocked up. Be that as it may, and as I've pointed out in your earlier post, it does appear that trainers who are paid by the groups perform more effectively than those who do not. I have no data on efficiency (i.e. how many groups are created relative to mode of remunaration) but according to the SAVIX (and where comparisons are exact) it seems that more savings are mobilised, more money circulates as loans and the returns on investment are usually better when we compare paid and unpaid community-based agents. I tend to think that positive outcomes might be closely correlated to results when your neighbours are the people who are paying you: a case of the financial reinforcing the social. But that's me. I must stop volunteering my time on this blog lest I contradict myself.

Wed, February 22, 2012 | Hugh Allen

NB: Originally published October 2011. We changed the date to move it up on the chronological list. I'm surprised that I am still having this discussion about motivation, especially after the work of Daniel Kahneman challenged conventional ideas about motivation, and this was even reflected in the World Bank's World Development Report 2015: Mind, Society, and Behavior. Seriously, notions of the primacy of money are out of date. Of course, one of the sectors where people still hold onto old ideas about the primacy of money is in the financial sector. Not surprising since it's the financial sector; what else would it think? Just don't let those people set the development agenda. 

 Clients at the center? Yeah, right...

Clients at the center? Yeah, right...

Volunteerism or Fee-for-Service?

Volunteerism or Fee-for-Service?