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Can Nudges Increase Take-up of the EITC?: Evidence from Multiple Field Experiments

Author

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  • Linos, Elizabeth
  • Prohofsky, Allen
  • Ramesh, Aparna
  • Rothstein, Jesse
  • Unrath, Matt

Abstract

The Earned Income Tax Credit distributes more than $60 billion to over 20 million low-income families annually. Nevertheless, an estimated one-fifth of eligible households do not claim it. We ran six preregistered, large-scale field experiments with 1 million observations to test whether "nudges" could increase EITC take-up. Despite varying the content, design, messenger, and mode of our messages, we find no evidence that they affected households' likelihood of filing a tax return or claiming the credit. We conclude that even the most behaviorally informed low-touch outreach efforts cannot overcome the barriers faced by low-income households who do not file returns.
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Suggested Citation

  • Linos, Elizabeth & Prohofsky, Allen & Ramesh, Aparna & Rothstein, Jesse & Unrath, Matt, 2020. "Can Nudges Increase Take-up of the EITC?: Evidence from Multiple Field Experiments," Department of Economics, Working Paper Series qt14678763, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
    • Handle: RePEc:cdl:econwp:qt14678763
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    Cited by:

    1. Antinyan, Armenak & Asatryan, Zareh, 2019. "Nudging for tax compliance: A meta-analysis," ZEW Discussion Papers 19-055, ZEW - Leibniz Centre for European Economic Research.
    2. Silvia Saccardo & Hengchen Dai & Maria A. Han & Sitaram Vangala & Juyea Hoo & Jeffrey Fujimoto, 2024. "Field testing the transferability of behavioural science knowledge on promoting vaccinations," Nature Human Behaviour, Nature, vol. 8(5), pages 878-890, May.
    3. Margot I. Jackson & Ester Fanelli, 2023. "Who Uses the Social Safety Net? Trends in Public Benefit Use among American Households with Children, 1980–2020," The ANNALS of the American Academy of Political and Social Science, , vol. 706(1), pages 16-36, March.
    4. Lucie Martin & Liam Delaney & Orla Doyle, 2022. "Everyday Administrative Burdens and Inequality," Working Papers 202202, Geary Institute, University College Dublin.
    5. Antinyan, Armenak & Asatryan, Zareh, 2024. "Nudging for tax compliance: A meta-analysis," ZEW Discussion Papers 24-054, ZEW - Leibniz Centre for European Economic Research.
    6. Pamela Herd & Donald Moynihan, 2023. "Fewer Burdens but Greater Inequality? Reevaluating the Safety Net through the Lens of Administrative Burden," The ANNALS of the American Academy of Political and Social Science, , vol. 706(1), pages 94-117, March.
    7. Li, Yuanxiang John & Hoffman, Elizabeth, 2023. "Designing an incentive mechanism for information security policy compliance: An experiment," Journal of Economic Behavior & Organization, Elsevier, vol. 212(C), pages 138-159.
    8. Heather Klemick & Ann Wolverton & Bryan Parthum & Kristin Epstein & Sandra Kutzing & Sarah Armstrong, 2024. "Factors Influencing Customer Participation in a Program to Replace Lead Pipes for Drinking Water," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 87(3), pages 791-832, March.
    9. Rosenqvist, Olof & Selin, Håkan, 2023. "Explaining benefit take-up behavior – the role of incentives and habits," Working Paper Series 2023:24, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    10. Iselin, John & Mackay, Taylor & Unrath, Matthew, 2023. "Measuring take-up of the California EITC with state administrative data," Journal of Public Economics, Elsevier, vol. 227(C).
    11. Gallegos, Sebastian & Roseth, Benjamin & Cuesta, Ana & Sánchez, Mario, 2023. "Increasing the take-up of public health services: An at-scale experiment on digital government," Journal of Public Economics, Elsevier, vol. 227(C).

    More about this item

    Keywords

    Social and Behavioral Sciences;

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

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