Rebate versus Matching, Again: How Opt-in Reshapes the Effectiveness of Price-Equivalent Subsidies

Traditional theory predicts equivalent effects of matching and rebate subsidies at equal prices, yet experiments favor matching.

Refinements narrow this gap but retain compulsory assignment; take-up is voluntary in practice.

We test this implementation margin in a nationwide, incentivized donation experiment with 2,400 Japanese adults, crossing subsidy type and assignment rule.

After equalizing budget constraints and accounting for comprehension, total giving is indistinguishable under compulsory assignment.

Under opt-in, the matching advantage re-emerges and nearly quadruples because rebate loses effectiveness.

LATE estimates suggest advantageous selection into matching but disadvantageous selection into rebate.

Self-selection can reshape the policy ranking of price-equivalent instruments.