Assets beyond savings in individual development accounts

Abstract

This study examines whether participation in Individual Development Accounts (IDAs) provides low-income participants with significant accumulation in assets beyond matched savings. Using a longitudinal experimental research design, the study tests whether the experiment affects accumulation in five types of assets: liquid assets, other financial assets, total financial assets, real assets, and total assets. Results show that the experimental and control groups do not differ to a statistically significant degree on the five measures. Because implausibly extreme values can influence statistical results, effects on asset accumulation are also estimated in models that delete the most extreme values. Results from these models suggest that IDA participants, at a marginally significant level, gain more real assets and total assets than do members of the control group at this stage of the experiment. © 2009 by The University of Chicago.