Unpacking Incentives and Capacities: Factors Affecting Actor Behaviour Change
Abstract
This paper addresses critical gaps in Market Systems Development guidance on incentives and capacities by providing detailed analysis of the specific factors that determine whether actors can or will change their behaviour. The paper distinguishes between capacities (the relationship between resources an actor has and resources required for behaviour change) and incentives (the relationship between benefits an actor values and behaviour change). Both are multifaceted and extend beyond financial factors to include risk, familiarity, social cost, and non-financial benefits. The Actor Behaviour Change (ABC) Factors framework links actors' resources and priorities to specific characteristics of desired behaviour changes, enabling practitioners to identify which actors could change their behaviour, what changes they could make, and what support is needed. The framework proves particularly useful for identifying overlooked incentives and capacities, helping programmes move beyond oversimplified analyses that focus on financial factors alone.
Key takeaways
- Capacities are multidimensional and require analysis of all resources an actor needs for behaviour change -not just financial capacity but also skills, information, time, and confidence
- Incentives extend far beyond financial benefits and include social costs, familiarity, risk perception, and non-monetary benefits that may be more important to behaviour change than economic benefits
- The ABC Factors framework enables systematic analysis of which actors could and would change behaviour, identifying both obvious and overlooked incentives and capacity barriers
- Distinguishing between actor capacity gaps, irrelevant resources, and capacity needs helps programmes target support more effectively and design behaviour change strategies that address the specific constraints affecting each actor type