State Earned Income Tax Credits and Participation in Regular and Informal Work

Gunter, Samara

doi:10.17310/ntj.2013.1.02

Cited by 8 publications

(5 citation statements)

References 50 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Based on the success of earlier policy changes, other researchers have proposed that the program should be expanded for both families with one child as well as for childless families (Hoynes 2014;Marr et al 2014). This study shows that the health benefits are largest for people in the plateau phase of the EITC schedule, which has been shown to provide pure income effects (Athreya et al 2010;Gunter 2013). This indicates that, if government policy provides cash transfers that are not conditional on earned income, the relevant effects on health status will correspond to the estimate show in Panel B of Table 7.…”

Section: Discussionmentioning

confidence: 50%

“…Previous research on the program has established that households in the phase-in part of the schedule increase their employment on the extensive margin following changes to the EITC (Eissa and Liebman 1996;Eissa et al 2008;Meyer 2010). On the other hand, earlier work has shown that household in the middle of the schedule receiving something close to a pure income effect because of little to no change in the number of hours worked (Athreya et al 2010;Gunter 2013). To my knowledge, no previous study has examined whether the effects of EITC changes on health outcomes differ across the three parts of the schedule.…”

Section: Robustness Checksmentioning

confidence: 91%

“…Specifically, I test whether the expansion had different health impacts for individuals falling in different parts of the EITC schedule (phase-in, plateau, and phase-out range). Previous work has established that individuals in the plateau part receive close to pure income effect (Athreya et al 2010;Gunter 2013), while those in the phase-in part have been found to work more on the extensive margin (Eissa and Liebman 1996;Eissa et al 2008;Meyer 2010). Thus, testing for different health effects across the three parts of the schedule can provide evidence whether cash transfer programs have different effects depending on if they are conditional on earned income.…”

Section: Introductionmentioning

confidence: 95%

See 2 more Smart Citations

The effects of income on health: new evidence from the Earned Income Tax Credit

Lenhart

2018

Rev Econ Household

View full text Add to dashboard Cite

This study examines the relationship between income and health by using an expansion of the Earned Income Tax Credit (EITC), which increased benefits to households with at least two children, as a source of exogenous variations of earnings. The paper adds to previous work by: (1) estimating treatment effects on the treated using simulated EITC benefits and longitudinal data; (2) testing whether health effects vary across the three different parts of the EITC schedule; (3) examining the role of food expenditures and health insurance as potential mechanisms. The study finds that income improves the likelihood of affected heads of households reporting to be in excellent or very good health by 6.9 to 8.9 percentage points. The effects are largest in the plateau phase of the EITC schedule, where previous researchers have identified pure income effects of the program. The results are robust to several additional specifications, including a semi-parametric DD model and specifications that account for the potential endogeneity of sample. When examining potential channels underlying the relationship between income and health, I find that affected household increase their food expenditures by 10.5 to 20.3 percent and are 1.52 percent more likely to have health insurance coverage. Keywords Income • Health • Earned Income Tax Credit • Food expenditures JEL classifications I14 • I38 • J38

show abstract

Section: Discussionmentioning

confidence: 50%

Section: Robustness Checksmentioning

confidence: 91%

Section: Introductionmentioning

confidence: 95%

See 1 more Smart Citation

The effects of income on health: new evidence from the Earned Income Tax Credit

Lenhart

2018

Rev Econ Household

View full text Add to dashboard Cite

show abstract

“…A large body of research for developed economies has studied how individuals respond to welfare policies, in particular, on the labor supply margin (see for instance the surveys in Moffitt, 2003, Ben-Shalom et al, 2011. The responses along additional margins, such as registered and unregistered employment, have received less attention in the literature on developed countries, although there is some evidence that programs that subsidize work based on declared earnings, such as the EITC in the United States, induce low income individuals to shift hours from informal to registered employment (Gunter 2013), in particular among the self-employed (LaLumia, 2009). As discussed above, a series of studies based on credible identification strategies have analyzed the labor market responses to conditional cash transfer programs in developing countries, specifically in regards to labor supply (Alzua et al, 2012, Banerjee et al, 2015, Imbert and Papp, 2015, registered employment , and choices between formal and informal work (Garganta and Gasparini, 2015).…”

Section: Introductionmentioning

confidence: 99%

The anatomy of behavioral responses to social assistance when informal employment is high

Bérgolo

Cruces

2021

Journal of Public Economics

View full text Add to dashboard Cite

The Anatomy of Behavioral Responses to Social Assistance When Informal Employment Is High * The disincentive effects of social assistance programs on registered employment are a first order policy concern in developing countries. Means tests determine eligibility with respect to some income threshold, and governments can only verify earnings from registered employment. The loss of benefit at some level of formal earnings is an implicit tax that results in a strong disincentive for formal employment. We study an income-tested program in Uruguay and extend previous literature by developing an anatomy of the behavioral responses to this program. Our identification strategy is based on a sharp discontinuity in the program's eligibility rule and uses information from the program's records, social security administration data, and a follow-up survey. First, we establish that beneficiaries respond to the program's incentives by reducing their levels of registered employment by about 8 percentage points. Second, we find the program induces a larger reduction of formal employment for individuals with a medium probability to be a registered employee, suggesting some form of segmentation-those with a low propensity to work formally do not respond to the financial incentives of the program. Third, we find evidence that the fall in registered employment is due to a larger extent to an increase in unregistered employment, and to a lesser extent to a shift towards non-employment. Fourth, we find an elasticity of participation in registered employment of about 1.7, implying a deadweight loss from the behavioral responses to the program of about 3.2% of total registered labor income.

show abstract

“…Resource constraints create what the World Bank has called a "vicious cycle, in which inadequate resources restrain output and undermine the quality of statistics, while the poor quality of statistics leads to lower demand and hence fewer resources" (World Bank, 2002, para 11). Complicating the effects of the so-called "vicious cycle" are the remnants of tumultuous economic times that spur difficult-to-monitor informal and black market economies (Jerven 2013;Gunter 2013).…”

Section: National Statistical Capacitymentioning

confidence: 99%

Developing Knowledge States: Technology and the Enhancement of National Statistical Capacity

Anderson

Whitford

2015

SSRN Journal

View full text Add to dashboard Cite

National statistical systems are the enterprises tasked with collecting, validating and reporting societal attributes. These data serve many purposesthey allow governments to improve services, economic actors to traverse markets, and academics to assess social theories. National statistical systems vary in quality, especially in developing countries. This study examines determinants of national statistical capacity in developing countries, focusing on the impact of general purpose technologies (GPTs). Just as technological progress helps to explain differences in economic growth, states with markets with greater technological attainment (specifically, general purpose technologies) arguably have greater capacity for gathering and processing quality data. Analysis using panel methods shows a strong, statistically significant positive linear relationship between GPTs and national statistical capacity. There is no evidence to support a non-linear function in this relationship. Which is to say, there does not appear to be a marginal depreciating National Statistical Capacity benefit associated with increases in GPTs. example, in 2010, the national statistical system of one developing country, Ghana, erroneously estimated their GDP and issued a revision that raised the statistic by some 60% (Jerven 2013, Devarajan 2013), the effect of which being an overnight reclassification of Ghana from a lowincome to middle-income country (Jerven 2013); the implications of these issues are profound for foreign aid, lending, commerce, development and foreign investment. The response from the international economic development community was a call for serious reflection on Africa's socalled "statistical tragedy" (Devarajan 2013) and reinforced support for international efforts to evaluate and improve national statistical systems (e.g., Willoughby 2008). Thus, serious

show abstract

State Earned Income Tax Credits and Participation in Regular and Informal Work

Cited by 8 publications

References 50 publications

The effects of income on health: new evidence from the Earned Income Tax Credit

The effects of income on health: new evidence from the Earned Income Tax Credit

The anatomy of behavioral responses to social assistance when informal employment is high

Developing Knowledge States: Technology and the Enhancement of National Statistical Capacity

Contact Info

Product

Resources

About