The Role of Stigma in the Design of Welfare Programs
Tel Aviv University - Eitan Berglas School of Economics; Ben-Gurion University of the Negev - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute)
Yoram Y. Margalioth
Tel Aviv University - Buchmann Faculty of Law
Tel Aviv University - Eitan Berglas School of Economics; National Bureau of Economic Research (NBER); CESifo (Center for Economic Studies and Ifo Institute); Institute for the Study of Labor (IZA)
CESifo Working Paper Series No. 2305
We consider the notion of welfare stigma a la Besley and Coate (1992b). This stigma is attributed to welfare claimants by society when they are perceived as undeserving in the sense that they falsely claim to be eligible for welfare benefits. However, due to imperfect information, this stigma may be extended, with some probability, to all welfare claimants. We examine the implications of this kind of stigma for the design of welfare programs.
Number of Pages in PDF File: 28
Keywords: welfare, take up, targeting, inequality, stigma
JEL Classification: H2, D6
Date posted: May 27, 2008
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