Information, Preferences, and Public Benefit Participation: Experimental Evidence from the Advance EITC and 401(k) Savings
American Economic Journal: Applied Economics
vol. 2,
no. 2, April 2010
(pp. 147-63)
Abstract
Within a field experiment, I present a treatment group with reductions in information, administrative, stigma, and procrastination costs associated with the Advance EITC. The treatment increases Advance participation from 0.3 to 1.2 percent. Another treatment simultaneously encourages 401(k) savings, increasing 401(k) participation from 46 to 50 percent. However, there is no additional increase in Advance participation when coupled with the 401(k) treatment, casting doubt on a long-term forced savings motive. The results indicate that EITC recipients actively forgo the Advance. Further work is needed to identify what underlies these preferences. Possible explanations include uncertainty and/or short-term forced savings motives. (JEL D14, D82, H23, H24, H31)Citation
Jones, Damon. 2010. "Information, Preferences, and Public Benefit Participation: Experimental Evidence from the Advance EITC and 401(k) Savings." American Economic Journal: Applied Economics, 2 (2): 147-63. DOI: 10.1257/app.2.2.147Additional Materials
JEL Classification
- D14 Personal Finance
- D82 Asymmetric and Private Information
- H23 Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies
- H24 Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes
- H31 Fiscal Policies and Behavior of Economic Agents: Household
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