A GRANT TO EVERY CITIZEN: SURVEY EVIDENCE OF THE IMPACT OF A DIRECT GOVERNMENT PAYMENT IN ISRAEL

Naomi Feldman, Ori Heffetz

Research output: Contribution to journalArticlepeer-review

Abstract

During the 2020 COVID-19 recession, Israel disbursed one-time, universal grants of $220 per adult and $150 per child. We ask survey respondents about the grant’s primary effect on their situation. Twenty to 45 percent report increasing spending, and 36–52 percent report reducing debts. Importantly, as many respondents report donating or helping friends or family as increasing saving (10–18 percent). While financially weaker respondents reduce debt more, stronger ones not only increase saving but also increase giving — a new finding of nonnegligible, voluntary, decentralized reallocation of governmental assistance. We explore how Israel’s political situation and our methodology may have affected our findings, helped by a follow-up US survey.

Original languageEnglish
Pages (from-to)229-263
Number of pages35
JournalNational Tax Journal
Volume75
Issue number2
DOIs
StatePublished - 1 Jun 2022
Externally publishedYes

Keywords

  • fiscal policy
  • marginal propensity to spend
  • politics
  • stimulus
  • survey methodology
  • universal transfers

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics and Econometrics

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