What Are the Main Barriers Preventing Eligible Individuals from Taking Up Social Benefits?

This study investigates the barriers preventing eligible individuals from taking up social benefits. Using two nationwide experiments in France with 60,000 job seekers, researchers examined the effects of in-person social service meetings and an online benefit eligibility simulator. Findings show that meeting with social workers increased new benefit take-up by 29%, particularly for income and family benefits, while the online simulator had no significant effect. Results suggest that transaction costs, rather than lack of information or stigma, are the main obstacle. Those benefiting most from assistance were also least likely to seek it, highlighting structural inefficiencies in benefit accessibility.

Full Citation and Link to Article

Castell, Laura, Marc Gurgand, Clément Imbert, and Todor Tochev. "Take-up of Social Benefits: Experimental Evidence from France". AMERICAN ECONOMIC JOURNAL: ECONOMIC POLICY (FORTHCOMING). https://www.aeaweb.org/articles?id=10.1257/pol.20220786&from=f

Extended Summary

Central Research Question

The research examines the barriers preventing eligible individuals from taking up social benefits. Despite the availability of social programs, many beneficiaries do not claim the support they qualify for. This study focuses on whether low take-up rates are primarily due to a lack of information, high transaction costs, or welfare stigma. Specifically, the study asks whether providing personalized assistance in navigating the application process increases benefit take-up more effectively than simply offering information about eligibility. By conducting two large-scale experiments in France, the study aims to understand what drives the decision to claim social benefits and what policy interventions can enhance participation.

Previous Literature

Prior research identifies three key reasons why individuals fail to claim benefits for which they qualify: lack of information, transaction costs, and welfare stigma. Studies suggest that a significant portion of those eligible for means-tested programs, such as the Earned Income Tax Credit (EITC) in the U.S., do not apply, despite the potential financial advantages. Some scholars argue that providing better information about eligibility can improve take-up rates, while others emphasize that complex application procedures impose substantial costs, particularly for individuals with lower cognitive or financial resources. Another strand of research explores the role of stigma, where individuals avoid claiming benefits due to concerns about social judgment or self-perception.

This study builds on previous literature by simultaneously testing the effects of different interventions: a meeting with a social worker that provides both information and application assistance, and an online tool that only provides personalized eligibility information. By comparing these two approaches, the study sheds light on whether benefit take-up is primarily hindered by lack of information, application complexity, or social stigma.

Data

The study utilizes data from two nationwide experiments conducted in France, targeting job seekers who may qualify for 15 different social benefits. The sample consists of 60,000 job seekers, with 30,000 assigned to a control group and 30,000 receiving invitations to a meeting with social services. Another 40,000 job seekers participated in a separate experiment testing the impact of an online eligibility simulator. The primary data sources include administrative records on benefit claims, survey responses on application attempts, and logs of simulator usage.

Administrative data from multiple agencies allowed the researchers to track benefit take-up at different time intervals (three and six months after intervention). Additional survey data provided insight into application attempts that did not result in benefit receipt, helping to evaluate whether the interventions improved targeting.

Methods

The study employs a randomized controlled trial (RCT) design, with two separate interventions. The first experiment randomly assigned job seekers to receive an invitation to an in-person or phone meeting with social services, where they received eligibility information and application assistance. The second experiment tested the effect of an email providing access to an online simulator that estimated benefit eligibility based on personal data.

The primary outcome of interest was whether individuals applied for and successfully received benefits within six months of the intervention. The researchers used Intention-to-Treat (ITT) estimates to measure the impact of being invited to the interventions and Local Average Treatment Effects (LATE) to estimate the effect of actual participation. They also employed Marginal Treatment Effects (MTE) analysis to explore whether those most in need were the least likely to access assistance.

To determine whether transaction costs were the primary barrier, the study compared the impact of meetings on benefits with complex application processes versus simpler ones. Additionally, the success rate of applications was examined to assess whether improved information led to better self-selection into benefit applications.

Findings/Size Effects

The study found that providing in-person assistance significantly increased benefit take-up, while simply providing information through an online tool had no measurable effect.

1. Effect of In-Person Assistance:

   • Job seekers who attended a meeting with social services were 29% more likely to receive a new benefit within six months.

   • The strongest effects were observed for income support benefits (+44%) and family and housing benefits (+21%).

   • No significant effect was found for health benefits, which required applications to a separate agency.

2. Effect of the Online Simulator:

   • While 67% of invited job seekers clicked on the simulator link, and 18% completed a simulation, benefit take-up did not increase.

   • The results suggest that a lack of information is not the primary barrier to claiming benefits.

3. Impact of Transaction Costs:

   • Benefits with more complex application processes saw greater increases in take-up, suggesting that administrative burdens are a key obstacle.

   • The success rate of applications decreased slightly among those who received assistance, implying that lower transaction costs encouraged more marginal applicants to apply.

4. Selection Effects and Targeting:

   • Those who benefited the most from assistance were the least likely to attend meetings, indicating that transaction costs also prevent individuals from accessing help.

   • The average benefit amount received by new claimants was lower than that of existing recipients, suggesting that assistance primarily helped those with smaller claims.

5. No Evidence for Welfare Stigma as a Major Barrier:

   • The study tested the effect of an anti-stigma flyer included in the meeting invitation but found no impact on attendance or benefit take-up.

   • The findings suggest that stigma may not be a significant deterrent in this context or that a simple intervention was insufficient to address it.

     
     

Conclusion

The study provides strong evidence that transaction costs are a major barrier to benefit take-up. While providing personalized eligibility information through an online tool had no effect, offering in-person assistance significantly increased participation in social programs. This suggests that simply informing individuals about their eligibility is not enough—policies must also focus on reducing application complexity.

The findings have important policy implications. Governments seeking to increase benefit take-up should prioritize interventions that lower administrative burdens, such as in-person assistance or automated application processes. Efforts to improve targeting must also consider that the individuals most in need may face the greatest obstacles in accessing support.

By demonstrating that in-person assistance substantially improves benefit take-up, this study reinforces the need for policies that go beyond information campaigns. Future research should explore how to design effective interventions that reach those least likely to seek help on their own.