Cash by any other name? evidence on labelling from the UK Winter Fuel Payment

<p><p><p><p><p><p><p><p><p>At this event, IFS researchers will present the results of new research, funded by the <a href="http://www.nuffieldfoundation.org">Nuffield Foundation</a>. </p><p></p><p></p><p><p>The first part of this research considers whether older households in the UK face a "heat or eat" trade-off, and must cut back on food expenditures to meet the extra heating expenses associate with spells of very cold weather. The second part of this research looks whether the labels given to cash benefits, such as the "Winter Fuel Payment", affects how they are spent.</p> </p><p></p><p></p><p><p>In the first paper, we merge detailed household level expenditure data from older households with historical local weather information and examine the extent to which older households are able to smooth spending over the worst temperature shocks. </p> </p><p></p><p></p><p><p>In the second paper, we investigate whether the labels sometimes given to government transfers (e.g. "Child Benefit or "Winter Fuel Payment") have any influence on what those payments are spent on. Standard economic theory implies that the label of a particular transfer should have no bearing on how that transfer is ultimately spent since all income is interchangeable. The empirical literature to date tends not to contradict this proposition. In the paper to be presented, we study the case of the UK Winter Fuel Payment (WFP), which is a cash transfer to older households. Sharp differences in the eligibility criteria provide an opportunity to assess the impact this transfer has on fuel spending and allows us to assess the behavioural effect of the labelling. </p> </p><p></p><p></p><p></p></p><p></p><p></p><p></p><p></p><p><p><b>Please note:</b> Due to the constraints of the venue, we are unable to provide access or facilities for wheelchair users, or facilities for people with severe hearing impairments. People with mobility needs should contact the Nuffield Foundation for guidance in advance of visiting the building.</p></p> </p><p></p>