Abstract

Poverty assistance is often administered in-kind even though cash transfers would raise recipi- ents’ welfare more effectively. We characterize the political economy constraint that paternalistic motives impose on the welfare system. In our experiment, a representative sample of U.S. citizens reveal their motives by deciding whether a real U.S. welfare recipient will receive monthly grocery deliveries over half a year, or whether the recipient will have a choice between these deliveries and monthly deliveries of cash equivalents. Respondents frequently impose restrictions. Two fifths restrict the recipient even if the cash equivalent is twice the value of the food. Only a third always let the recipient choose. Respondents restrict a significantly larger proportion of recipients than they believe, indicating that their decisions are partially misguided. A conserva- tive political stance is associated with significantly more restrictions. Respondents’ goal is not to ensure sufficient healthy nutrition, but to prevent consumption of items deemed inappropriate. While respondents reveal stereotypes in various survey questions, recipient race, gender, age, and parental status have little effect on restriction decisions, on average. 

Co-authors : B. Douglas Bernheim, Tony Q. Fan, Zach Freitas-Groff

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