Market Systems Development & Behavior/Incentives Presentation

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20 Mar 2019, 1:30 p.m.

John Hoven

Also, it’s important to keep in mind that when you investigate a specific
market system, you are looking at human interactions and relationships in a
one-of-a-kind situation. Projects like this require analytic methods that
can
- discover unknown unknowns (answers to questions we didn’t think to ask),
and
- discover and prove cause-and-effect in one-of-a-kind situations (sample
size = 1)

On Mon, Mar 18, 2019 at 4:37 PM [Hidden email] <
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19 Mar 2019, 4:04 p.m.

Noor Alam Khan

Hi,
The target of all market systems development program is a behavioral change
driven by incentives. So normally people in seemingly market systems
development program start to train people with a lot of assumptions as you
mentioned. Market systems development programmes go deep into the
underlying structure to see things why certain things are not functioning
in a way the way we expect to them to function and how are the incentive
structures are designed that maintain the current situation? There you come
with certain modalities with incentives and develop
interventions/partnerships that have the potential to improve the
situation. Normally people think it is a behavioral problem, in reality,
such problems are structural. So your intervention design trigger the
problem and that triggers incentive structures and if the incentives
started to flow and the significance is higher, then you can expect repeat
use and finally the market will start to adopt the change or new practice
introduced leading to behavioral change. Anything which is designed on weak
incentives and assumption will receive push back and its uptake won't take
to the level where it is important for behavior change. Though behavioral
science is important for market systems development programme but more
importantly instead of looking at behaviors of individual actors looking at
the emergent behavior of interactions of complex elements would be more
helpful. Markets are complex living systems and they adapt to change in a
different manner and their collective behavior would be important to look
at.

Cheers,

N

Noor Alam Khan
Private Sector Development Professional
0346-9405559

On Mon, Mar 18, 2019 at 8:57 PM [Hidden email] <
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19 Mar 2019, 3:53 p.m.

Katie Whitehouse

There was a similar discussion to this happening a few years ago when I was
working with Oxfam looking at how to use the lead time in a pre-crisis
market analysis to really understand the behaviour drivers of consumers in
their purchase and use decisions for WASH products and services.
Acknowledging earlier comments, in a crisis situation understanding
behaviours and incentives is a luxury the humanitarian sector rarely has
time to understand in depth during response and early recovery, but in a
endemic or protracted crisis, there may be some opportunity.

For us, we looked more so at the behaviours of all actors in the market we
were focusing on with particular emphasis on household consumers (in which
limited needs assessment or KAP analysis often make the assumptions around
WASH consumption behaviour for market analysis). We modified that needs and
KAP analysis required in a humanitarian setting for UNICEF WASH Cluster
that still met required standards but dug a little deeper with more
qualitative questions to understand consumer behaviour better. We did this
because we wanted to challenge the premise that people were not purchasing
and using household water treatment based on the assumption that people
simply couldn't afford to. In the end we gathered a lot of data that
challenged this assumption and attempted to modify intervention tactics to
create incentives for consumers to purchase and use HHWT. Although we got
some traction with trying these new approaches, behaviour change takes TIME
and humanitarian programmes (and their funding cycles) do not have that. We
found ourselves in an interesting challenge of having to try and create a
programme that was straddling both a humanitarian and development portfolio
with only humanitarian resourcing which takes us back to the old discussion
around resilience and the hum-dev nexus. But the exciting thing is that
with the right data we were able to propose something different and we
started gathering some evidence of sustaining demand from consumers
(more-so consumer segments that had not been previously part of aid
interventions) but also in stimulating local markets in public health
products. I am not sure whether any monitoring data was published by Oxfam
although initial insights were discussed in various forums across 2017.

There are not many examples of this crossover between BE and MSD in the
humanitarian sector. We co-authored a paper to try and find case studies on
it with the BEAM Exchange, Sussex Uni, Tufts Uni, PSI and Oxfam. It was a
quick (we only had a few weeks of funding to create it is limited in its
depth) first stab at trying to create something to think about for the WASH
sector a few years back to ground the idea of BE and MSD for humanitarian
WASH with some academic rigour. Essentially we wanted to kickstart a
discussion about the topic but I think it is most definitely a difficult
one for the sector to work out, practically, where to use it. For me, given
the funding/time challenges in creating interventions that stimulate
sustainable behaviour change it is the endemic and protracted crisis
situations and long-term recovery where this type of thinking fits best.

Blog on topic here -
https://beamexchange.org/community/blogs/2017/5/12/bringing-behavioural-market-based-approach-humanitarian-response-design-and-resilience-thinking/
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BEAM paper here - https://beamexchange.org/resources/985/

Happy reading. It is certainly a topic I would be much more interested to
pilot and test more of. Feel free to get in touch if you have more
questions.

Katie

19 Mar 2019, 1:11 p.m.

Jake Lomax

In case it’s helpful please see link below to a paper I wrote with Rachel Shah and published by Springfield. It breaks down the key MSD concepts of incentives and capacities into a more detailed typology of factors affecting behaviour change that makes it easier to build conceptual links with social sciences generally, including behavioural economics. It also sets out how to integrate a deeper analysis of factors affecting behaviour change into the process of doing MSD.

https://www.researchgate.net/publication/328345712_Unpacking_incentives_and_capacities_factors_affecting_actor_behaviour_change
Unpacking incentives and capacities: factors affecting actor behaviour change
The paper presents a generalisable typology to support analysis of the broad range of reasons underlying behaviour change - or the absence of behaviour change. The typology is applicable to multiple fields, but is presented in this paper as an analytical tool for use by practitioners in Market Systems Development (MSD) programmes particularly. It uses the Mechanisms of Social Change framework to deepen understanding of the concepts of incentives and capacities widely applied in MSD.

18 Mar 2019, 8:26 p.m.

Ben Taylor

Hi,

I think you've really hit on the frontier of MSD here in that it matters
and is rare. Incentives are often 'considered' but are almost universally
assumed to be financial. Mike's case is really good. We've also been
working with a couple of programmes attempting to employ frameworks which
force a more in-depth consideration of incentives at an earlier stage.

They employ nodal and actor-level stakeholder analysis and use a typology
of incentives including financial, social, moral, legal/mandated, temporal,
power, political, quality of life, and intrinsic incentives. It then links
this with a typology of capabilities and a typology of intervention/support
types and aims to make sure that the right instrument is being employed
according to the relevant capabilities and incentives. Most interestingly,
on intrinsic, we have engaged in some experimental designs at the early
stages of intervention to generate evidence of key steps in the theory of
change around behaviour changes, before pursuing the systemic change based
on this behaviour.

Needless to say that such analyses are even less likely to be found in
'markets in crisis' (although we're trying) and the arguments here would
often be 'it doesn't matter how well you analyse incentives, there's only
one person who's even close to being willing to work with us so we have to
do it anyway'.

Dr. Ben Taylor
*CEO*

W: www.agoraglobal.org
ben.taylor.cambridge

Agora Global is a limited company registered in England and Wales. Co. No.
11297828

18 Mar 2019, 6:47 p.m.

Julie Lawson-McDowall

Hi,
You might like to look at CRS' model for financial inclusion through savings and loans groups - they train a cadre of locals with high school certs to provide financial inclusion training to their peers - form groups, learn about savings, support on loans and end year calculations - and this cadre is paid by the groups. This way, the savings model continues after the project finishes and a new 'semi-profession' is developed.
All best,
Julie

18 Mar 2019, 4:59 p.m.

Michael FIeld

Very interesting post. I have done a lot around integrating systems thinking and behavioral economics. I have developed some tools around linking behavior patterns in business to mental model biases. I have also integrated behavior change tactics into interventions, including how to help firms selling inputs to integrate such tactics into their marketing practices. Are these the types of things that might be interesting? There was a case prepared for my last project, Agricultural Value Chains, Bangladesh, that investigated how we integrated systems thinking, institutional economics and behavioral economics, which is attached, that might be interesting. I am happy to send more stuff, but do not want to just send stuff randomly, and the intersection of systems thinking and behavioral Econ Is very broad. If you are more interested in behavioral change, I can share some ideas on behavior change tactics and how I have tried to get firms to apply some tactics. I have also used behavioral Econ frameworks to better understand the incentives behind patterns of which some of the thinking is in the attached case.
Best
Mike

Mike Field
[Hidden email]
+1703-712-2459

18 Mar 2019, 3:27 p.m.

[Hidden email]

I wanted to put together a presentation on what I guess works out to be a mesh of "Market Systems Development" and "Behavioral Economics", that is implementing a market systems project with incentives explicitly included in the design, from the beginning.

More projects than I care to remember are premised on highly unlikely human behavior assumptions. Examples being that while there are always exceptions depending on a rural farmer to go out and train the masses just because they received a training seems unlikely without some sort of compensation (keep in mind, in our work many people in the field don’t have the luxury of setting aside time from providing for their families to do some altruistic training) and it seems equally unlikely that most people would pay for such trainings (eg I've noticed that many better-off-than-your-average-African-farmer Americans still balk at paying for a lawyer [information services] despite the detail that the US legal system seems to be really complicated).

Anyway, I would really like to find some information out there that touches on the intersection of MSD & BE. Any thoughts or pointers to relevant information would be appreciated!

Thanks.

-R