Employment Effects of the Earned Income Tax Credit: Taking the Long View
The Earned Income Tax Credit (EITC) is the cornerstone U.S. anti-poverty program for families with children, typically lifting millions of children out of poverty each year. Targeted to low-income households with children, and only available to those who work, the EITC contains strong incentives for non-workers to become employed. Most of the existing economics literature focuses on federal EITC expansions in the 1980s and 1990s. This paper takes a longer view, studying all federal expansions since the program’s inception in 1975. We find robust evidence that EITC expansions increase the extensive margin of labor supply.
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Copy CitationDiane Whitmore Schanzenbach and Michael R. Strain, "Employment Effects of the Earned Income Tax Credit: Taking the Long View," NBER Working Paper 28041 (2020), https://doi.org/10.3386/w28041.
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Published Versions
Employment Effects of the Earned Income Tax Credit: Taking the Long View, Diane Whitmore Schanzenbach, Michael R. Strain. in Tax Policy and the Economy, Volume 35, Moffitt. 2021