Cash by Any Other Name? Evidence on Labelling from the UK Winter Fuel Payment
AbstractStandard economic theory implies that the labelling of cash transfers or cash-equivalents (e.g. child benefits, food stamps) should have no effect on spending patterns. The empirical literature to date does not contradict this proposition. We study the UK Winter Fuel Payment (WFP), a cash transfer to older households. Exploiting sharp eligibility criteria in a regression discontinuity design, we find robust evidence of a behavioural effect of the labelling. On average households spend 41% of the WFP on fuel. If the payment was treated as cash, we would expect households to spend approximately 3% of the payment on fuel.
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Bibliographic InfoPaper provided by Koc University-TUSIAD Economic Research Forum in its series Koç University-TUSIAD Economic Research Forum Working Papers with number 1216.
Length: 33 pages
Date of creation: Jun 2012
Date of revision:
labelling; benefits; expenditure.;
Other versions of this item:
- Timothy K.M. Beatty & Laura Blow & Thomas Crossley & Cormac O'Dea, 2011. "Cash by any other name? Evidence on labelling from the UK Winter Fuel Payment," IFS Working Papers W11/10, Institute for Fiscal Studies.
- D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
- H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
This paper has been announced in the following NEP Reports:
- NEP-AGR-2012-06-13 (Agricultural Economics)
- NEP-ALL-2012-06-13 (All new papers)
- NEP-ENE-2012-06-13 (Energy Economics)
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