Research fellow project Low Take-up of Social Benefits and Financial Inclusion


Cash transfer and other social protection programs have greatly expanded in developing countries in the last two decades. Their coverage varies greatly – not all eligible individuals participate, even in universal programs. The issue of low take up of benefits, which has been extensively studied in advanced economies, has received less attention in low and middle income countries. The main research question is why eligible households and individuals fail to sign up for programs that would benefit them, which implies a reduction in their welfare, and a loss of budgetary and administrative resources. Some of the barriers posited in the literature are the fear of stigma, administrative and transaction costs and hassle, lack of information or inattention, and misinformation/misperceptions about potential negative consequences of signing up. All of these issues are exacerbated in a developing country context with high levels of informality and complex regulations. In this proposal, we develop a mechanism field experiment with beneficiaries of Argentina’s largest conditional cash transfer program (with 4 million beneficiaries, 40% of the country’s 0-17 year olds), who systematically fail to claim a substantial additional monetary subsidy channeled through a VAT rebate (only 5 to 10% of beneficiaries receive this additional transfer). To foster financial inclusion, beneficiaries of cash transfers are assigned a bank account and a debit card. Moreover, the government established an additional benefit through a VAT rebate for purchases made with debit cards, as an incentive for firms to formalize. Beneficiaries can receive an additional transfer in their accounts if they use their government-provided debit card to purchase goods. However, the vast majority chose to extract all the cash the day it is deposited in their account and forego the additional benefit. They may do so because they do not want to be identified as beneficiaries when making purchases (stigma), because they do not have access to retailers equipped with debit card readers or because prices are higher in these more formal stores (cost/hassle), because they are unaware of the benefit’s existence (information), or because they fear that the government might use their shopping behavior to reduce future benefits (misperception). We will design a multi treatment mechanism field experiment which will help us distinguish between these 3 alternative explanations and unearth the extent to which the more rational (costs, lack of information), and behavioral (inattention, stigma, misperceptions) factors explain the underperformance of the program. The experiment will guide the reform of the program and future information campaigns to increase take-up and maximize resources for the poor.


Project leader: Guillermo Cruces

Project researchers: Veronica Amarante | Maria Josefina Baez | Lucía Ramírez

Scientific mentors: Habiba Djebbari | John Cockburn

Journal publication

No journal publications.

Working Papers

Title Modified Size Comments Recommendations
Low Take-Up and Financial Inclusion: Experimental Evidence from Argentina’s Cash Transfers 2020-08-10 3.44MB 0 0

Policy Briefs

No policy briefs.

Final report

No final reports.


Title Modified Size Comments Recommendations
2019-08-29 848.64kB 1 1

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