Americans don’t agree on how safety-net programs should work. For example, Republicans are pushing to strengthen work requirements for the Supplemental Nutrition Assistance Program, also known as SNAP or food stamps, and co-payments for Medicaid, which provides low-income people with health insurance. Democratic lawmakers and consumer advocates argue that such obligations deny or strip benefits from those who need them most.
I am a behavioral economist, meaning I study the underlying preferences that drive human behavior and decision-making. To see whether the American public wants the government to make public benefits contingent upon these kinds of requirements, I conducted a study that measured how much of their own money people would donate to food aid programs if recipients had to contribute some of their own time or money to get benefits.
Not surprisingly, my research team found that the public is split on this issue as well.
Economists have been writing and wondering about the costs and benefits of what we call contribution requirements since the 1970s. If no one knows whether recipients value the aid, the thinking goes, then perhaps small fees and other mandates can make it easier to see who values and perhaps needs it most.
This works for all kinds of folks, not just the poor. Any of your neighbors might take a bag of kale harvested from your garden if you offer it for free. Chances are, only those who actually plan to cook the greens or turn them into a salad would be willing to pay even a pittance for it.
However, a trade-off is that work requirements and other contingencies are costly enough for recipients that some of the people who absolutely need a hand won’t get it. A large body of research has found that Medicaid copays and premiums, for example, lead to people who need health coverage not getting any, even if they’re set at just a dollar.
Together with University of California San Diego economist Sally Sadoff, I decided to do a study to see whether the public is aware of these trade-offs, and how they influence support for these programs. This is critical because policymakers need to respond to the preferences of the public.
The value of chipping in
We contacted nearly 5,000 Americans we located through a representative survey panel over the internet. Our approach was simple: Participants got US$8 if they completed our surveys.
Prior to one survey, we asked them how much of that money we were paying them they’d be willing to donate toward food aid programs that we administer through the University of Southern California. In these programs we personally established in partnership with a Los Angeles grocery store, low-income people get bags of fruits and vegetables worth $10.
To learn more about what influences decisions people make about giving, we created different ways that the aid recipients had to contribute to get bags of healthful food. The study’s participants fell into three groups at random. Members of each one heard one of the following things about the produce:
- Recipients get it for free
- Recipients pay $1
- Recipients pay $5
We modeled these programs after co-pay requirements, or the idea that people in need should pay something in exchange for public benefits. Some states like Montana and Michigan already require small premiums and co-pays from Medicaid recipients. Other states are phasing in this cost-sharing approach.
Much of the debate regarding the safety net centers around work requirements – the idea that “able-bodied” aid recipients should do paid work or be in school to be eligible for aid.