NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

The ARRA: Some Unpleasant Welfare Arithmetic

Casey B. Mulligan

NBER Working Paper No. 18591
Issued in December 2012, Revised in February 2013
NBER Program(s):Labor Studies, Public Economics

Distributions of tax rates on job acceptance and layoff margins are estimated for unemployed household heads and spouses under three benefit and tax rule scenarios: actual rules under the American Reinvestment and Recovery Act, rules as they would have been if they had not been changed since 2007, and rules as they might have been with a bigger fiscal stimulus. Two or three million unemployed household heads and spouses, with a variety of tax situations, had as much disposable income while unemployed as they would have by accepting a job that paid 80-100 percent of their previous one. The number would have been less than one million under 2007 rules, and about nine million under a bigger stimulus. Tax obligations and foregone unemployment insurance about equally erode the rewards from retaining a job, or starting a new one.

download in pdf format
   (203 K)

email paper

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w18591

Users who downloaded this paper also downloaded* these:
Mulligan w18426 Recent Marginal Labor Income Tax Rate Changes by Skill and Marital Status
Mulligan w18088 Do Welfare Policies Matter for Labor Market Aggregates? Quantifying Safety Net Work Incentives since 2007
Mulligan w19365 Average Marginal Labor Income Tax Rates under the Affordable Care Act
Feyrer and Sacerdote w16759 Did the Stimulus Stimulate? Real Time Estimates of the Effects of the American Recovery and Reinvestment Act
Kopczuk w18584 Taxation of Intergenerational Transfers and Wealth
 
Publications
Activities
Meetings
NBER Videos
Themes
Data
People
About

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us