Working Paper: NBER ID: w20718
Authors: Dayanand S. Manoli; Nicholas Turner
Abstract: Can one-time informational interventions cause permanent changes in benefit take-up? In the context the Earned Income Tax Credit, we find evidence that reminding individuals of their eligibility has meaningful effects. Reminder notices have the largest effect among taxpayers without kids, persuading nearly 80 percent of taxpayers in the notice year to claim the credit. The effect of the notice quickly attenuates to roughly 22 percent only one year later. We find that this pattern holds across two experimental settings, one that tests the effect of being sent a notice and one that tests variations in the content of the notices.
Keywords: EITC; informational interventions; taxpayer behavior; nudge effects; learning effects
JEL Codes: H24; H31
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| IRS notices (H26) | EITC claiming behavior (H26) |
| EITC claiming behavior (H26) | long-term learning effects for taxpayers without children (H31) |
| EITC claiming behavior (H26) | long-term learning effects for taxpayers with children (H31) |
| IRS notices (H26) | nudge effect (D91) |
| nudge effect (D91) | diminishes over time (D15) |
| IRS notices (H26) | influence of different types of notices on claiming behavior (D91) |