CeDEx Brown Bag Seminar - Guillermo Cruces

This week's Brown Bag Seminar will be "Low Take-Up of Benefits: Field Experiment Evidence from Beneficiaries of Argentina’s Conditional Cash Transfers" by Professor Guillermo Cruces (Nottingham)

Abstract:
Cash transfer and other social protection programs have greatly expanded in developing countries in the last two decades, but their coverage varies greatly, even among eligible individuals. We study the low take up of benefits by means of an information field experiment involving 400,000 beneficiaries of Argentina’s largest conditional cash transfer program (with 2.2 million beneficiaries – parents of 4 million children, 40% of the country’s 0-17 year olds). Beneficiaries are assigned a bank account and a debit card, and can receive a substantial additional monetary subsidy channelled through a VAT rebate when they pay in stores with their debit cards. However, they systematically fail to claim this benefit: only about 15% of beneficiaries receive this additional transfer. The experiment is designed to unearth the extent to which rational (costs, lack of information) and behavioral (inattention, stigma, misperceptions) factors contribute to the low take up of the benefit. We find that recipients of SMS messages significantly increase their use of debit card and subsequent rebate, but the effects are economically small. The evidence points towards limited information rather than salience effects and towards frictions related to financial inclusion.

1pm to 2pm with lunch provided

Venue A41 Sir Clive Granger