Financial stress by design: examining barriers to social welfare take-up

Doctoral Thesis of Olaf Simonse 

 

Financial scarcity, marked by insufficient resources, challenges individuals and households to meet basic needs and negatively impacts emotions, thoughts, behavior, well-being, and health. This leads to financial stress, characterized by a perceived lack of resources, control, and increased worry. Social welfare systems can alleviate financial stress by providing necessary resources to low-income households, but widespread non-take-up of social welfare limits its effectiveness.This dissertation aims to deepen the understanding of the dynamic relationship between financial stress and mental well-being, identify economic predictors of financial stress, and explore the determinants of non-take-up of social welfare as a tool for alleviating financial stress. The first part examines the relationship between financial stress and mental health, highlighting the dynamic interaction between these factors during the COVID-19 pandemic. Adopting an integrative approach, the study also investigates the influence of various economic conditions—income, debts, savings, income volatility, and employment—on financial stress.The second part focuses on the non-take-up of social welfare. It addresses gaps in the literature through a systematic review, qualitative interviews, empirical testing of an integrated model for take-up of benefits, and an experimental design. Findings reveal the complexity of factors influencing non-take-up, including administrative burden, fear of reclaims, and perceived eligibility. The impact of reclaims on non-take-up is examined, highlighting the specific deterrent effect of reclaims on welfare participation. The dissertation concludes with recommendations for future research and policy design, emphasizing the need for simpler, more accessible social welfare systems to reduce financial stress and improve overall well-being among financially vulnerable households.

 

Supervisors: Wilco van DijkLotte van Dillen en Eric van Dijk 

Date: 2024-09-11

 

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