The myth of the "millionaire mindset": Experimental evidence from Filipino entrepreneurs

Professor Dean Yang will talk about the recent paper, "Aspirations and Financial Decisions: Experimental Evidence from the Philippines."

A randomized experiment among poor entrepreneurs tested the impact of exogenously inducing higher financial aspirations. In theory, raising aspirations could have positive effects by inducing higher effort, but could also reduce effort if unmet aspirations lead to frustration. Treatment resulted in more ambitious savings goals, but nearly all individuals fell far short of reaching these goals. Two years later, treated individuals had not saved more, and actually had lower borrowing and business investments. Treatment also reduced belief in the amount of control over one’s life. Setting aspirations too high can lead to frustration, leading individuals to reduce their economic investments. (from "Aspirations and Financial Decisions: Experimental Evidence from the Philippines").

Faculty Expert

Dean Yang

Professor of Economics and Public Policy

Yang's research is on the economic problems of developing countries. His specific areas of interest include: international migration, microfinance, health, corruption, political economy, and the economics of disasters. He teaches a Ford School course on the economics of developing countries, as well as a PhD course in development economics.

• Dean Yang
• International Finance
• international economics
• financial aspirations
• entrepreneurship
• the Philippines