Social image concerns and welfare take-up

Friedrichsen's personal website

The article is written jointly with Tobias König and Renke Schmacker. 

Using a laboratory experiment, we present first evidence that social image concerns causally reduce the take-up of an individually beneficial transfer. This reduction is not only statistically but also economically significant and amounts to 30 percentage points. Our design manipulates the informativeness of the take-up decision by varying whether transfer eligibility is based on ability or luck, and how the transfer is financed. We find that subjects avoid the inference both of being low-skilled (ability stigma) and of being willing to live off others (moral stigma). Using a placebo treatment, we exclude other explanations for the observed stigma effects.