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Human Well-Being And In-Work Benefits: A Randomized Controlled Trial

Author

Listed:
  • Dorsett, Richard

    (National Institute of Economic and Social Research)

  • Oswald, Andrew J

    (Department of Economics, University of Warwick)

Abstract
Many politicians believe they can intervene in the economy to improve people’s lives. But can they? In a social experiment carried out in the United Kingdom, extensive in-work support was randomly assigned among 16,000 disadvantaged people. We follow a sub-sample of 3,500 single parents for 5 ensuing years. The results reveal a remarkable, and troubling, finding. Long after eligibility had ceased, the treated individuals had substantially lower psychological wellbeing, worried more about money, and were increasingly prone to debt. Thus helping people apparently hurt them. We discuss a behavioral framework consistent with our findings and reflect on implications for policy JEL classification: I31 ; D03 ; D60 ; H11 ; J38

Suggested Citation

  • Dorsett, Richard & Oswald, Andrew J, 2014. "Human Well-Being And In-Work Benefits: A Randomized Controlled Trial," The Warwick Economics Research Paper Series (TWERPS) 1038, University of Warwick, Department of Economics.
    • Handle: RePEc:wrk:warwec:1038
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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Human Well-being and In-Work Benefits: A Randomized Controlled Trial
      by maximorossi in NEP-LTV blog on 2014-03-11 18:40:25

    Citations

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    Cited by:

    1. O'Donnell, Gus & Oswald, Andrew J., 2015. "National well-being policy and a weighted approach to human feelings," Ecological Economics, Elsevier, vol. 120(C), pages 59-70.
    2. Li, Liming & Avendano, Mauricio, 2023. "Lone parents' employment policy and adolescents’ socioemotional development: Quasi-experimental evidence from a UK reform," Social Science & Medicine, Elsevier, vol. 320(C).
    3. Hetschko, Clemens & Schöb, Ronnie & Wolf, Tobias, 2020. "Income support, employment transitions and well-being," Labour Economics, Elsevier, vol. 66(C).
    4. Bruno Van der Linden, 2021. "Do in-work benefits work for low-skilled workers?," IZA World of Labor, Institute of Labor Economics (IZA), pages 246-246, June.
    5. Boyd-Swan, Casey & Herbst, Chris M. & Ifcher, John & Zarghamee, Homa, 2016. "The earned income tax credit, mental health, and happiness," Journal of Economic Behavior & Organization, Elsevier, vol. 126(PA), pages 18-38.
    6. Wolf, Tobias & Hetschko, Clemens & Schöb, Ronnie, 2016. "Income Support, (Un-)Employment and Well-Being," VfS Annual Conference 2016 (Augsburg): Demographic Change 145860, Verein für Socialpolitik / German Economic Association.
    7. Dräger, Vanessa, 2015. "Do Employment Protection Reforms Affect Well-Being?," IZA Discussion Papers 9114, Institute of Labor Economics (IZA).

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    More about this item

    JEL classification:

    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D60 - Microeconomics - - Welfare Economics - - - General
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy

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