Scarcity and the Mindsets of Social Welfare Recipients: Evidence from a Field Experiment
Journal of Public Administration Research and Theory 2022
33 Pages Posted: 6 Jan 2023
Date Written: 2022
Abstract
Financial scarcity is a fundamental condition for recipients of social welfare. But how does scarcity affect their ability to improve their prospects? In a field experiment using Danish unemployed social assistance recipients (N = 2,637), we test the impact of scarcity by randomly assigning recipients to be surveyed either shortly before payment of their social assistance benefits, shortly after, or mid-month. We find no impact of the scarcity manipulation. However, a series of cross-sectional regressions show that perceived scarcity, i.e. ‘the feeling of having too little’, is associated with an increased focus on solving problems, but negatively associated with psychological well-being, sense of mastery, and job search self-efficacy. Our findings run counter to the idea that changes in scarce financial conditions influence the mindsets of social welfare recipients and simultaneously points to the importance of subjective feelings of scarcity.
Keywords: Scarcity, financial strain, social welfare, administrative burden, coping strategies, field experiment
JEL Classification: C93, H83, I32, I38, J64
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