Receiving earned wages early raised output by about 7% in a short Odisha experiment. The workers’ wage rates stayed unchanged.
Supreet Kaur, Sendhil Mullainathan, Suanna Oh and Frank Schilbach studied 408 low-income men making leaf plates on short, piece-rate contracts in Odisha’s lean employment season in 2017–2018. Their paper appeared online on November 27, 2024, before its February 2025 Quarterly Journal of Economics issue.
Timing, rates and uncertainty
Workers were randomly assigned interim or end-of-contract payments. Gains followed cash receipt, with no detected announcement effect. Higher output could increase total earnings. Gains were concentrated among poorer workers.
Researchers checked extra leaves, stitches and undone stitches. Evidence of fewer attention-related errors was weaker across the full sample. The psychological mechanism remains unresolved. The experiment does not establish lasting gains, results for salaried offices or the value of commercial earned-wage-access products.
An employer’s own comparison
Consider a hypothetical packing business exploring an extra payment of wages already earned. A useful review could place acceptable packs per paid hour and rework alongside payroll processing costs and voluntary worker feedback. Ask whether the payment arrived when promised and whether workers understood the payslip, without collecting their private financial histories.
Record other changes too. A new machine or a simpler batch of orders could mislead a before-and-after comparison. Agree what would justify continuing: workers might value a clearer payment process even without an output gain. Nobody’s wages should be delayed to create a comparison.
This scorecard is an editorial application, not the tested intervention.
The Crunch
A useful payroll review records what changed, what it cost and what workers experienced. Decide how to judge those results before starting.