TY  - JOUR
AU  - Meyer,Bruce D.
AU  - Rosenbaum,Dan T.
TI  - Welfare, the Earned Income Tax Credit, and the Labor Supply of Single Mothers
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 7363
PY  - 1999
Y2  - September 1999
UR  - http://www.nber.org/papers/w7363
L1  - http://www.nber.org/papers/w7363.pdf
N1  - Author contact info:
Bruce D. Meyer
Harris School of Public Policy
University of Chicago
1155 E. 60th Street
Chicago, IL 60637
Tel: 773/702-2712
Fax: 773/702-0926
E-Mail: bdmeyer@uchicago.edu

Dan T. Rosenbaum
E-Mail: drosenbaum@omb.eop.gov
M2  - featured in NBER digest on 2000-02-01
AB  - During 1984-96, welfare and tax policy changed dramatically.  The Earned Income Tax Credit was expanded, welfare benefits were cut, welfare time limits were added and cases were terminated, Medicaid for the working poor was expanded, training programs were redirected, and subsidized or free child care was expanded. Many of the program changes were intended to encourage low income women to work.  During this same time period there were unprecedented increases in the employment and hours of single mothers, particularly those with young children.  In this paper, we first document these large changes in policies and employment. We then examine if the policy changes are the reason for the large increases in single mothers' labor supply.  We find evidence that a large share of the increase in work by single mothers can be attributed to the EITC, with smaller shares for welfare benefit reductions, welfare waivers, changes in training programs, and child care expansions.  We also find that most of these policies increased hours worked.  Our results indicate that financial incentives through the tax and welfare systems have substantial effects on single mothers' labor supply decisions.
ER  -