PUBLICATIONS AND UNDER REVIEW

"The Long-Term Impact of the Earned Income Tax Credit on Children’s Education and Employment Outcomes" with Kathy Michelmore

  • Journal of Labor Economics (October 2018, vol. 36, no. 4, pp. 1127-1163)

  • Abstract: Using 4 decades of variation in the federal and state EITC, we estimate the impact of exposure to EITC expansions in childhood on education and employment outcomes in adulthood. Reduced-form results suggest that an additional $1,000 in EITC exposure when a child is 13–18 years old increases the likelihood of completing high school (1.3%), completing college (4.2%), and being employed as a young adult (1.0%) and earnings by 2.2%. Our analysis reveals that the primary channel through which the EITC improves these outcomes is increases in pretax family earnings.

  • Ungated version here

  • Media: The Brookings Institution, Tax Policy Center, National Affairs, Biden Forum, Brad DeLong, Medium, Chalkbeat

“The Rise of Working Mothers and the 1975 Earned Income Tax Credit”

JOB MARKET PAPER

“Do EITC Expansions Pay for Themselves? Effects on Tax Revenue and Public Assistance Spending” with Maggie R. Jones

  • Abstract: This paper studies how behavioral responses to the EITC affect the program's budgetary cost. The EITC encourages labor supply and increases income, thereby reducing public assistance payments to households and increasing taxes paid by households. These sources of revenue reduce the EITC's net cost. We use administrative Internal Revenue Service tax data linked to Current Population Survey data on enrollment in public assistance programs to estimate the EITC's net cost. The evidence from three decades of EITC policy expansions implies that the EITC decreases public assistance received by mothers and increases payroll and sales taxes paid. Our estimates suggest that the EITC has a self-financing rate of 87 percent, so that the EITC's true cost is only 13 percent of the sticker price. Although the EITC is one of the largest and most important public assistance programs in the U.S., we show that the EITC is actually one of the least expensive anti-poverty programs in the U.S., costing taxpayers about half as much as the school lunch and breakfast programs.

  • Media: The Economist, The Brookings Institution, Mother Jones, National Review, Poverty Research IRP, Council on Economic Policies, Confessions of a Supply-Side Liberal

  • Presentations: 2018: University of Michigan, University of Chicago Harris School of Public Policy, University of Wisconsin, University of Southern California (scheduled), University of Texas at Austin, National Tax Association, Association for Public Policy Analysis & Management, Annual Conference of the Federal Statistical Research Data Centers, Columbia University, International Institute of Public Finance.

WORK IN PROGRESS

"Unintended Consequences? More Marriage, More Children, and the EITC"

  • Presentations: 2018: Society of Labor Economists, Research and Evaluation Conference on Self-Sufficiency; 2017: International Institute of Public Finance, National Tax Association

  • Abstract: The EITC provides a ``marriage bonus'' to some couples but a ``marriage penalty'' to others: the average incentive is theoretically ambiguous, has changed over time, and existing empirical evidence has been mixed. The EITC also encourages some households to have more children but others to have less. Using over 30 years of household panel data, I find that federal and state EITC expansions increase marriage and fertility, and decrease non-marital cohabitation. These results imply that some estimates in the EITC literature may be biased, since endogenous switching from unmarried to married or increasing fertility would violate the stable-group-composition condition required by difference in differences.

“Public Policy and Time Spent Between Mothers and Children” with Lance Lochner
“The Earned Income Tax Credit and Older Workers” with Mark Borgschulte
“Does the EITC Help or Harm Rural America? Evidence from Migration” with Dan Black
“Stuck in the Labor Force? Losing Access to the EITC” with Mark Borgschulte, Nirupama Rao
“Attitudes Towards Working Women and World War II”
“The 1964 Civil Rights Act and Black-White Outcomes: 50 Years Later”

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