A distinguishing feature of recent changes to the US system of public assistance is its increasing focus on
working families and reliance on the
tax system to transfer dollars to needy families. ...After a decade in near total obscurity, the earned income tax credit (EITC) was expanded to become the largest cash-transfer program for lower-income families with children. Advocates of the EITC argue that, unlike traditional welfare, the credit helps “promote both the values of family and work”. Indeed, empirical evidence consistent with economic theory suggests that the EITC promotes employment among eligible unmarried women with children. To target benefits to lower-income families, however, the EITC is based on
family income, leading to traditional welfare-type disincentives for most eligible secondary earners. In fact, the EITC is likely to reduce overall family labor supply among married couples.
This paper examines the labor force participation response of married couples to EITC expansions between 1984 and 1996. The effect of the credit is estimated using both quasi-experimental and traditional reduced-form labor supply models. Results from both models show the same qualitative conclusion, that the EITC expansions reduced total family labor supply of married couples. In all cases, we find a decline in labor force participation by married women that more than offsets any rise in participation by their spouses. While the labor force participation rate of married men increased by about 0.2 percentage points, that of married women decreased by just over a full percentage point. These aggregate effects mask substantial heterogeneity in the population. Women facing the strongest disincentives were more than 2 percentage points less likely to work after the expansions. These findings imply that the EITC is effectively subsidizing married mothers to stay home, and therefore, have implications for the design of the program.
We discuss the potential role of universal basic incomes (UBIs) in advanced countries. A feature of advanced economies that distinguishes them from developing countries is the existence of ...well-developed, if often incomplete, safety nets. We develop a framework for describing transfer programs that is flexible enough to encompass most existing programs as well as UBIs, and we use this framework to compare various UBIs to the existing constellation of programs in the United States. A UBI would direct much larger shares of transfers to childless, nonelderly, nondisabled households than existing programs, and much more to middle-income rather than poor households. A UBI large enough to increase transfers to low-income families would be enormously expensive. We review the labor supply literature for evidence on the likely impacts of a UBI. We argue that the ongoing UBI pilot studies will do little to resolve the major outstanding questions.
We examine the impact of a positive and policy-driven change in economic resources available in utero and during childhood. We focus on the introduction of the Food Stamp Program, which was rolled ...out across counties between 1961 and 1975. We use the Panel Study of Income Dynamics to assemble unique data linking family background and county of residence in early childhood to adult health and economic outcomes. Our findings indicate access to food stamps in childhood leads to a significant reduction in the incidence of metabolic syndrome and, for women, an increase in economic selfsufficiency.
This paper evaluates the health impacts of a signature initiative of the War on Poverty: the introduction of the modern Food Stamp Program (FSP). Using variation in the month FSP began operating in ...each U.S. county, we find that pregnancies exposed to FSP three months prior to birth yielded deliveries with increased birth weight, with the largest gains at the lowest birth weights. We also find small but statistically insignificant improvements in neonatal mortality. We conclude that the sizable increase in income from FSP improved birth outcomes for both whites and African Americans, with larger impacts for African American mothers.
Who suffers during recessions? Hoynes, Hilary Williamson; Miller, Douglas Lee; Schaller, Jessamyn
The Journal of economic perspectives,
07/2012, Letnik:
26, Številka:
3
Journal Article
Recenzirano
Odprti dostop
In this paper, we examine how business cycles affect labor market outcomes in the United States. We conduct a detailed analysis of how cycles affect outcomes differentially across persons of ...differing age, education, race, and gender, and we compare the cyclical sensitivity during the Great Recession to that in the early 1980s recession. We present raw tabulations and estimate a state panel data model that leverages variation across U.S. states in the timing and severity of business cycles. We find that the impacts of the Great Recession are not uniform across demographic groups and have been felt most strongly for men, black and Hispanic workers, youth, and low-education workers. These dramatic differences in the cyclicality across demographic groups are remarkably stable across three decades of time and throughout recessionary periods and expansionary periods. For the 2007 recession, these differences are largely explained by differences in exposure to cycles across industry-occupation employment. PUBLICATION ABSTRACT
This paper uses quasi-experimental variation from federal tax reform to evaluate the effect of the EITC on infant health outcomes. We find that the EITC reduces the incidence of low birth weight and ...increases mean birth weight: a $1,000 treatment-on-the-treated leads to a 2 to 3 percent decline in low birth weight. Our results suggest that the candidate mechanisms include more prenatal care and less negative health behaviors (smoking). Additionally, we find a shift from public to private insurance coverage, and for some a reduction in insurance overall, indicating a potential change in the quality and perhaps quantity of coverage.
The past quarter-century has seen substantial change in the social safety nets for families with children in the United States and Canada. Both countries have moved away from cash welfare, but the ...United States has relied more on work requirements. We examine the implications for the employment and poverty of low-educated single mothers. We find that employment improved substantially in both countries, absolutely and relative to a control group of single women without children. Poverty rates also declined in both countries, with more of the decline coming through market income in the United States and benefit income in Canada.
This paper examines the impact of changes in labor market conditions on participation in the Aid to Families with Dependent Children (AFDC) program in California. Transitions off welfare and ...transitions back onto welfare are estimated using discrete duration models that control for local labor market conditions, demographic and neighborhood characteristics, duration effects, county-fixed effects, time effects, and county-specific time trends. The results show that higher unemployment rates, lower employment growth, lower employment-to-population ratios, and lower wage growth are associated with longer welfare spells and higher recidivism rates. Hispanics, blacks, and two-parent families are the groups that are most sensitive to changes in local labor market conditions.
The goal of federal food and nutrition programs in the United States is to improve the nutritional well-being and health of low income families. A large body of literature evaluates the extent to ...which the Supplemental Program for Women Infants and Children (WIC) has accomplished this goal, but most studies have been based on research designs that compare program participants to non-participants. If selection into these programs is non-random then such comparisons will lead to biased estimates of the program's true effects. In this study we use the rollout of the WIC program across counties to estimate the impact of the program on infant health. We find that the implementation of WIC led to an increase in average birth weight and a decrease in the fraction of births that are classified as low birth weight. We find no evidence that these estimates are driven by changes in fertility or selection into live births. Our preferred estimates suggest that WIC initiation raised average birth weight by 2Â g, or by 7Â g among infants born to mothers with low education levels. These translate into estimated birth weight increases among participating mothers of approximately 18 to 29Â g. Estimated treatments on the treated impacts among infants born to participating mothers with low education are of similar magnitude.
Safety Net Investments in Children HOYNES, HILARY W.; SCHANZENBACH, DIANE WHITMORE
Brookings papers on economic activity,
04/2018, Letnik:
2018, Številka:
1
Journal Article
Recenzirano
In this paper, we examine what groups of children are served by core childhood social safety net programs—including Medicaid, EITC, CTC, SNAP, and AFDC/TANF—and how they have changed over time. We ...find that virtually all gains in spending on the social safety net for children since 1990 have gone to families with earnings, and to families with income above the poverty line. These trends are the result of welfare reform and the expansion of in-work tax credits. We review the available research and find that access to safety net programs during childhood improves outcomes for children and society over the long run. This evidence suggests that the recent changes to the social safety net may have lasting negative effects on the poorest children.
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