Helping
Wired and Hired: Employment Effects of Subsidized Broadband Internet for Low-Income Americans
George Zuo
American Economic Journal: Economic Policy, forthcoming
Abstract:
I present evidence on the relationship between broadband pricing and labor market outcomes for low-income individuals. Specifically, I estimate the effects of a Comcast service providing discounted broadband to qualifying low-income families. I use a triple differences strategy exploiting geographic variation in Comcast coverage, individual variation in eligibility, and temporal variation pre- and post-launch. Local program availability increased employment rates and earnings of eligible individuals, driven by greater labor force participation and decreased probability of unemployment. Internet use increased substantially where the program was available.
Employed in a SNAP? The Impact of Work Requirements on Program Participation and Labor Supply
Colin Gray et al.
University of Virginia Working Paper, August 2020
Abstract:
Work requirements are common in many U.S. safety net programs. Evidence remains limited, however, on the extent to which work requirements increase economic self-sufficiency or screen out vulnerable individuals. Using linked administrative data on food stamps (SNAP) and earnings with a regression discontinuity design, we find that work requirements reduce SNAP participation by 52 percent. Very low-income and homeless adults are disproportionately screened out. We statistically rule out employment increases of more than 2 percentage points. We find evidence of increased earnings near a key eligibility threshold, and provide conditions under which this trade-off is efficient.
Employment Effects of the Earned Income Tax Credit: Taking the Long View
Diane Whitmore Schanzenbach & Michael Strain
NBER Working Paper, October 2020
Abstract:
The Earned Income Tax Credit (EITC) is the cornerstone U.S. anti-poverty program, typically lifting over 5 million 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.
Do Welfare Benefits Pay Electoral Dividends? Evidence from the National Food Stamp Program Rollout
Vladimir Kogan
Journal of Politics, forthcoming
Abstract:
Growing evidence suggests that pocketbook considerations influence voting behavior in the United States and other developed countries and that incumbents can use targeted government benefits to win voter support. It remains unclear whether the general relationship between government spending and incumbent support also holds for means-tested welfare programs, however. I contribute to this empirical literature by taking advantage of the decade-long rollout of the American Food Stamp Program. The staggered timing of local program implementation allows me to credibly estimate the causal effect of this new benefit on election outcomes. Overall, I find that Democrats - at the center of the program's enacting coalition - gained votes when the program was implemented locally, apparently through mobilization of new supporters rather than the conversion of political opponents.
Can Nudges Increase Take-up of the EITC?: Evidence from Multiple Field Experiments
Elizabeth Linos et al.
NBER Working Paper, November 2020
Abstract:
The Earned Income Tax Credit (EITC) distributes more than $60 billion to over 20 million low-income families annually. Nevertheless, an estimated one-fifth of eligible households do not claim it. We ran six pre-registered, large-scale field experiments to test whether "nudges" could increase EITC take-up (N=1million). Despite varying the content, design, messenger, and mode of our messages, we find no evidence that they affected households' likelihood of filing a tax return or claiming the credit. We conclude that even the most behaviorally informed low-touch outreach efforts cannot overcome the barriers faced by low-income households who do not file returns.
In-kind transfers and home production
Matthew Greenblatt
Review of Economics of the Household, December 2020, Pages 1189-1211
Abstract:
Why are in-kind transfers a prominent feature of the U.S. social safety net, and why is such a significant fraction of these benefits given to individuals who do not actively supply labor in the market? This paper presents home production as a novel rationalization for such transfers. It first shows that in a broad class of dynamic Mirrleesian models that include only market production, the optimal allocation features undistorted marginal rates of substitution between goods whenever agents are not working, and thus in-kind benefits provided to these agents do not help decentralize an optimal allocation. However, adding home production drastically changes the nature of the optimal allocation. In particular, if goods and labor are substitutes in home production and home and market productivity are positively correlated, in-kind benefits in the form of goods used in home production, such as groceries, energy, and housing capital, should be provided to agents who do not work. A numerical simulation shows that the optimal in-kind program for disabled workers in a plausibly calibrated version of the home production model is consistent with the scale of SNAP and other programs that provide home production goods in the U.S.