In early August, 2020, during the COVID-19 pandemic, Israel disbursed one-time, universal grants to its citizens, of $220 per adult and $150 per child. Using survey data, we estimate that 25–45 percent either had already mostly spent or were planning to spend the money by year’s end and 36–52 percent mostly paid down debts. Interestingly, about as many people reported mostly donating the grant or using it to help family or friends as reported saving it (10–18 percent), with donations mostly originating from higher-income respondents. This voluntary rerouting of governmental assistance may help alleviate the trade-off between targeting and simplicity/speed of disbursement.
|Name||NBER working paper series|
|Publisher||National Bureau of Economic Research|