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Social image concerns and welfare take-up

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  • Friedrichsen, Jana
  • König, Tobias
  • Schmacker, Renke

Abstract

Using a laboratory experiment, we present first evidence that social image concerns causally reduce the take-up of an individually beneficial transfer. Our design manipulates the informativeness of the take-up decision by varying whether transfer eligibility is based on ability or luck, and how the transfer is financed. We find that subjects avoid the inference both of being low-skilled (ability stigma) and of being willing to live off others (free-rider stigma). Using a placebo treatment, we exclude other explanations for the observed stigma effects. Although stigma reduces take-up, elicitation of political preferences reveals that only a minority of “taxpayers” vote for the public transfer.

Suggested Citation

  • Friedrichsen, Jana & König, Tobias & Schmacker, Renke, 2018. "Social image concerns and welfare take-up," Journal of Public Economics, Elsevier, vol. 168(C), pages 174-192.
  • Handle: RePEc:eee:pubeco:v:168:y:2018:i:c:p:174-192
    DOI: 10.1016/j.jpubeco.2018.10.008
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    Cited by:

    1. Bastani, Spencer & Giebe, Thomas & Miao, Chizheng, 2019. "Ethnicity and tax filing behavior," MPRA Paper 97047, University Library of Munich, Germany.

    More about this item

    Keywords

    Stigma; Signaling; Redistribution; Non-take-up; Welfare program;

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

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