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WP202210-Stimulus-payments-and-private-transfers.pdf
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Private transfers can affect the spending response to stimulus payments, as those receiving income windfalls may transfer resources to other households in greater financial need. We report a survey experiment where individuals were asked how they would respond to a £500 payment, with a randomly selected subset of individuals explicitly told that all households would receive the same payments (a ‘public windfall’ scenario). This additional information increased MPCs by 11%. Reported transfer intentions in response to windfalls suggest that public payments crowd out private transfers, partly accounting for the higher MPCs in the public windfall case.
Authors

Research Fellow University of Oxford
Hamish is the James Meade Professor of Economics at the University of Oxford, a Professorial Fellow of Nuffield College and a Research Fellow at IFS.

Research Fellow University of Michigan
Tom is a Research Fellow at IFS, a Research Professor for the Institute for Social Research at the University of Michigan.

Deputy Research Director
Peter joined in 2009. He has published several papers on the microeconomics of household spending and labour supply decisions over the life-cycle.

Paul Fisher
Working Paper details
- DOI
- 10.1920/wp.ifs.2022.1022
- Publisher
- Institute for Fiscal Studies
Suggested citation
Crossley, T et al. (2022). Stimulus payments and private transfers. London: Institute for Fiscal Studies. Available at: https://ifs.org.uk/publications/stimulus-payments-and-private-transfers (accessed: 6 February 2025).
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