Working Paper

Low Take-up Rates: The Role of Information

Momi Dahan, Udi Nisan
CESifo, Munich, 2006

CESifo Working Paper No. 1829

This paper exploits a quasi-natural experiment to study the role of information in determining take-up patterns of social benefits in a non-stigma environment. We find that take-up rate of households who have the incentive to search for information for a longer period of time is between 8 and 13 percentage points higher as compared to a control group of households. This result is robust to the inclusion of various household characteristics. Our finding provides strong empirical support for information as an important explanation for low take-up rates.

Keywords: take-up, social benefits, information cost