Alternatives to Paying Child Benefit to the Rich: Means Testing or Higher Tax?

Apps, Patricia; Rees, Ray; Thoresen, Thor Olav; Vattø, Trine Engh

doi:10.2139/ssrn.3644819

Cited by 4 publications

(12 citation statements)

References 41 publications

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“…Proponents make an intuitive argument for residualist vs universalist programs. 6 They say means testing reduces government spending by targeting benefits to fewer people, which lessens the need for taxation to finance the program. The argument goes on that less taxation is good because greater taxation reduces taxpayers' incentive to work.…”

Section: A Means Test Is a Taxmentioning

confidence: 99%

“…Instead of raising $240 billion through income taxation, the government raised $165 billion through income taxation and clawed back the other $75 billion with a means test. 6 With income taxation, as factor income rises, disposable income does not rise in step because tax liabilities increase. With means testing, as factor income rises, disposable income does not rise in step because transfer payments decrease.…”

Section: A Means Test Is a Taxmentioning

confidence: 99%

“…Because labor supply effects increase with tax rates, the financing for a residualist pro-gram, compared with a universalist one, is likely to worsen labor supply. 6 Illusory supposed savings impose societal costs. Second, people have qualifying children only for a portion of their lives, so spreading the cost smooths income over time.…”

Section: A Means Test Is a Taxmentioning

confidence: 99%

See 2 more Smart Citations

The Public Health Case for a Universalist Child Tax Credit

2022

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In the US, 21% of children, more than 15 million children, live in poverty, far higher than other Organization for Economic Cooperation and Development countries. 1 A heartbreaking example of structural racism, Black, Hispanic, and Indigenous children are 3 times more likely to live in poverty than White children. 2 Like lead exposure, child poverty worsens physical, mental, and developmental health, along with education and social mobility, throughout one's life. 2,3 Therefore, reducing child poverty is a major public health goal, but how best to do so is unclear.Social policy, including cash child benefits, could improve health by reducing child poverty, but a policy's effects depend greatly on the details of its design. Medical and public health professionals may be reticent to wade into technocratic social policy minutiae, but if we care about the conditions that shape health, we have to care about the details of policies that shape those conditions. Here, we discuss these issues in the context of the largest US legislative effort to address child poverty in a generation: the American Rescue Plan Act expansion of the Child Tax Credit (CTC).

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Section: A Means Test Is a Taxmentioning

confidence: 99%

Section: A Means Test Is a Taxmentioning

confidence: 99%

Section: A Means Test Is a Taxmentioning

confidence: 99%

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The Public Health Case for a Universalist Child Tax Credit

2022

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“…In this subsection, we analyze the excess burden of potentially excessive subsidies. This line of analysis follows Apps et al (2020) stress that a complete look at redistributive policies requires an explicit analysis of the loss of welfare related to distortions created by this policy. In their case, they show that the use of a targeted tax on the rich for financing universal child allowances is a better mechanism than means-tested allowances.…”

Section: Self-selection Constraintmentioning

confidence: 99%

“…The literature on active labor market welfare programs has empirically documented long-run effects in the education field. See Bastian and Michelmore (2018) to learn about the impact of the EITC on education achievements. Hoynes and Rothstein (2019) explain that the Basic Income program also has potentially important long-run effects.…”

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confidence: 99%

Government Welfare Policy Under a Skilled-Biased Technological Change

Strawczynski

Tirosh

2022

Public Finance Review

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In a world where machines replace unskilled work, an active labor market policy—represented by the combination of an optimal Earned Income Tax Credit (EITC) and income maintenance for the unemployed—provides incentives to increase participation in the labor market and depresses wages for unskilled employees. In this paper, this policy is tested against the alternative of allowing unskilled workers to receive a means-tested basic income (MTBI), as recently adopted by Spain. For a liberal social planner (i.e., includes consumption and leisure in individual utility), the MTBI dominates the active labor market policy. For a conservative social planner (i.e., evaluates social welfare based on individual utility from consumption), the active labor market policy dominates the MTBI. The potential dynamic effects of active labor policy on labor supply were considered in a simulation using updated empirical estimates; it shows that this policy becomes preferable for both types of the social planner.

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Multisector Collaboration vs. Social Democracy for Addressing Social Determinants of Health

BERKOWITZ

2023

Milbank Quarterly

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Policy Points Multisector collaboration, the dominant approach for responding to health harms created by adverse social conditions, involves collaboration among health care insurers, health care systems, and social services organizations. Social democracy, an underused alternative, seeks to use government policy to shape the civil (e.g., civil rights), political (e.g., voting rights), and economic (e.g., labor market institutions, property rights, and the tax‐and‐transfer system) institutions that produce health. Multisector collaboration may not achieve its goals, both because the collaborations are difficult to accomplish and because it does not seek to transform social conditions, only to mitigate their harms. Social democracy requires political contestation but has greater potential to improve population health and health equity.

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Alternatives to Paying Child Benefit to the Rich: Means Testing or Higher Tax?

Cited by 4 publications

References 41 publications

The Public Health Case for a Universalist Child Tax Credit

The Public Health Case for a Universalist Child Tax Credit

Government Welfare Policy Under a Skilled-Biased Technological Change

Multisector Collaboration vs. Social Democracy for Addressing Social Determinants of Health

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