Full Citation

Title: The Effect of the Child Tax Credit on the Labor Supply of Mothers

Citation Type: Dissertation/Thesis

Publication Year: 2011

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Abstract: This paper analyzes the effects of changes in the Child Tax Credit and Additional Child Tax Credit on labor force participation and hours worked among mothers. I focus on three periods: the late 1990s when the policy was first introduced, the early 2000s when the Child Tax Credit per dependent expanded, and the late 2000s when the earned income threshold level to receive the tax credit was lowered to allow more tax-filers with children to qualify for the credit. The predicted loss in tax revenue to the government by this tax credit in 2010 alone was $52 billion. I examine the effect of the total tax credit on labor force participation and hours worked among women using difference-in-difference regressions with women with no children as the control group since they do not qualify for the Child Tax Credit and women with children as the treatment group. I find an increase in labor force participation and hours worked, conditional on working, among single mothers relative to single women with no children following the introduction of the Child Tax Credit, but no significant change in the subsequent years surrounding the expansions of the tax credit.

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Authors: Kidd, Andrew

Institution: University of Notre Dame

Department: Economics

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Degree: Bachelor of Arts

Publisher Location: Notre Dame, IN

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Data Collections: IPUMS CPS

Topics: Family and Marriage, Labor Force and Occupational Structure, Other

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