Childhood vaccines are one of the most cost-effective child health interventions in the world.

A 2016 study by Johns Hopkins University, published in Health Affairs, found that for every US$1 spent on immunization, US$16 is saved in healthcare costs, lost wages, and lost productivity due to illness. Taking into account the broader benefits of people living longer, healthier lives, the return on investment rises to US$44 per US$1 spent. (Source)

“Vaccination has made a fundamental contribution to the prevention of numerous infectious diseases. Worldwide, it is estimated that vaccines prevent, annually, 5 million deaths caused by smallpox, 2.7 million cases of measles, 2 million cases of neonatal tetanus, 1 million cases of pertussis, 600,000 cases of paralytic poliomyelitis, and 300,000 cases of diphtheria” – Remy et al., Journal of Market Access and Health Policy (Source)

Vaccines can also have a huge economic impact for families and communities:

“A healthy child is more likely to go to school and become a more productive member of society in later life, while their families can avoid the often crippling healthcare costs that diseases can bring. As this important study shows, this is enough to save millions of people from the misery of extreme poverty. To realize these figures we now need to redouble our efforts to ensure every child, no matter where they’re born, has access to lifesaving vaccines.” – Dr Seth Berkley, CEO of Gavi, the Vaccine Alliance (Source)

Despite the effectiveness of vaccines, every year millions of children—most of them in very poor, rural areas of low-income countries—don’t receive routine vaccinations against preventable, yet deadly, diseases like measles, tuberculosis, and tetanus. Policymakers, practitioners, and funders seek cost-effective ways to close the coverage gap.

Small incentives can be effective at increasing vaccination rates.

In Nigeria, a randomized controlled trial found that women who received small cash incentives of $2-$5 were significantly more likely to get a tetanus vaccine than women in the comparison group. Researchers also found that transportation costs were one of the significant barriers that prevented women from receiving vaccination at clinics, and that cash incentives compensate for transportation costs unless such costs are large. (Source)

In rural Udaipur in India, a small noncash incentive of one kilogram of lentils (valued at less than €1) led to significantly more children being fully immunized (38% vs 16% in control areas without the incentive), according to a landmark randomized controlled trial (Source). Researchers concluded that,“[S]mall incentives have large positive impacts on the uptake of immunization services in resource poor areas and are more cost effective than purely improving supply.”

Conditional cash transfers can increase health-enhancing behaviors.

Conditional cash transfers (CCT), in which cash is provided to a recipient conditional on certain behaviors or actions, have been shown to increase investments in education and health. For health, an evidence review found that “CCT beneficiaries… are more likely to have visited health providers for preventive checkups, to have had their children weighed and measured, and to have completed a schedule of immunizations.” (Source)

For vaccinations in particular, previous evidence has found that conditional cash transfer programs can be effective at boosting vaccination rates. It is important to note, however, that not all programs have worked (Source)—success has depended on the design of the program, baseline levels of vaccination, and access to vaccines.¹ It’s also important to note that many of the CCT programs featured large transfers. 

Until recently, a randomized evaluation had not been conducted on a cash incentive program designed to encourage routine childhood immunization in an area of sub-Saharan Africa with low initial vaccination rates.

New Incentives’ model doubled the proportion of infants who were fully immunized.

An independent, randomized evaluation found the program doubled the percentage of infants who were fully vaccinated (BCG, Penta 1-3, and measles), increasing coverage from roughly a quarter to just over half of all infants. The evaluation also found that the program had improved the timeliness (within one month) of the measles vaccine, optimizing the protection of the vaccine. Additionally, program clinics were more likely to report no or rare stockouts than control clinics, suggesting that the program’s impact may go beyond stimulating vaccine demand to also reduce vaccine supply constraints. (Source)

Learn more: Policy Brief | Summary

Cash recipients spend the funds they receive on items to improve their lives—contrary to concerns, recipients don’t squander the money on “temptations.” 

Before much research existed on this topic, many people assumed that giving people cash wouldn’t work because people would misspend the money on “temptations” like alcohol or tobacco or not use it on things that would benefit them. We now know that’s not true. In a 2015 global review of the evidence (Source), David Evans and Anna Popova reviewed 19 quantitative studies and concluded that:

“Almost without exception, studies find either no significant impact or a significant negative impact of transfers on temptation goods. In the only (two, non-experimental) studies with positive significant impacts, the magnitude is small. This result is supported by data from Latin America, Africa, and Asia.”

Even when cash was disbursed to high-risk men in Liberia, some of them petty criminals, a randomized controlled trial found that recipients invested most of the funds in businesses or saved it. (Source)

Despite concerns that cash incentives may reduce intrinsic motivation for vaccination, there is also no evidence to suggest small transfers do.

We have not found any strong evidence to suggest that small incentives reduce intrinsic motivation to get vaccinated. A 2013 review of existing evidence on the potential of incentives to undermine or "crowd out" intrinsic motivation found “for health related behaviors, baseline levels of incentivized behaviors are usually low, and only a subset involve an interpersonal conflict of interest. Correspondingly, we find no evidence for crowding out of incentivized health behaviors.” (Source) 

Relatedly, a study in Tanzania found that cash incentives increased motivation for preventive healthcare (for HIV patients to attend clinic visits) even after the incentive stopped. (Source)

However, more evidence is needed on this topic, and New Incentives and other organizations continue to monitor the research as the evidence base grows.

New Incentives’ model is “one of the most cost-effective ways we’ve found to save a life,” according to GiveWell’s analysis. 

Based on the above and other evidence, GiveWell estimates that, on average, the total cost to immunize one child through New Incentives' program is $142. Their estimate for cost per life saved based on grants in 2020 is about $4,500. (If that sounds high, read this post on why it is so expensive to save lives).  

“New Incentives is one of our top-rated charities and we believe that it offers donors an outstanding opportunity to accomplish good with their donations.” - GiveWell

Sources:

Banerjee, Abhijit Vinayak, Esther Duflo, Abdul Latif Jameel, Rachel Glennerster, Dhruva Kothari. "Improving Immunisation Coverage in Rural India: Clustered Randomised Controlled Evaluation of Immunisation Campaigns with and without Incentives." BMJ 340, c2220 (2010).  

Bastagli, Francesca, Jessica Hagen-Zanker, Luke Harman, Valentina Barca, Georgina Sturge, Tanja Schmidt, and Luca Pellerano. Cash transfers: what does the evidence say? A rigorous review of programme impact and the role of design and implementation features. ODI 1, no.7 (2016).

Blattman, Christopher, Julian C. Jamison, and Margaret Sheridan. "Reducing Crime and Violence: Experimental Evidence from Cognitive Behavioral Therapy in Liberia." American Economic Review 107, no. 4 (2017): 1165-1206.

Czaicki, Nancy L., William H. Dow, Prosper F. Njau, and Sandra I. McCoy. "Do incentives undermine intrinsic motivation? Increases in intrinsic motivation within an incentive-based intervention for people living with HIV in Tanzania." PLOS ONE 13, no. 6 (2018): e0196616.

Evans, David K.; Popova, Anna. Cash Transfers and Temptation Goods : A Review of Global  Evidence. Policy Research Working Paper. No. 6886. Washington, DC: World Bank, 2014.

Fiszbein, Ariel, and Norbert R. Schady. Conditional cash transfers: reducing present and future poverty. World Bank Publications, 2009.

Lagarde, Mylene, Andy Haines, and Natasha Palmer. “The impact of conditional cash transfers on health outcomes and use of health services in low and middle income countries.” Cochrane Database of Systematic Reviews 4, no. 4 (2009), Art. No. CD008137.

Ozawa, Sachiko, Samantha Clark, Allison Portnoy, Simrun Grewal, Logan Brenzel, and Damian G. Walker. "Return on Investment from Childhood Immunization in Low-and Middle-income Countries, 2011–20." Health Affairs 35, no. 2 (2016): 199-207.

Rémy, Vanessa, York Zöllner, and Ulrike Heckmann. "Vaccination: the cornerstone of an efficient healthcare system." Journal of Market Access & Health Policy 3, no. 1 (2015): 27041.

Sato, Ryoko and Benjamin Fintan. "Effect of cash incentives on tetanus toxoid vaccination among rural Nigerian women: a randomized controlled trial." Human Vaccines & Immunotherapeutics 16, no. 5 (2020): 1181-1188.