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Title: Essays in Public Economics

Citation Type: Dissertation/Thesis

Publication Year: 2020

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Abstract: This dissertation consists of two empirical studies in public and labor economics. In the first chapter, I estimate the effects of the Child and Dependent Care Credit (CDCC) on paid child care participation and parents’ labor market outcomes. In the second chapter, I estimate the effects of time limits in the Temporary Assistance for Needy Families (TANF) program on access to financial resources as proxied by welfare use, labor supply, income, and participation in other safety net programs. I: The Effects of Child Care Subsidies on Paid Child Care Participation and Labor Market Outcomes: Evidence from the Child and Dependent Care Credit The Child and Dependent Care Credit (CDCC), a tax credit based on taxpayers’ income and child care expenses, reduces families’ child care costs. The nonrefundable federal CDCC is available to working families with children younger than 13 years old in all states, and nearly half of states supplement the federal credit with their own child care credits. The Economic Growth and Tax Relief Reconciliation Act expanded the federal CDCC in 2003, and this led to differential increases in CDCC generosity across states and family sizes. I document CDCC eligibility and expenditures over time and across income and demographic groups. Using data from the March Current Population Survey, I find that a 10 percent increase in CDCC benefits increases annual paid child care participation by five percent among households with children younger than 13 years old. I also find that CDCC benefits increase labor supply among married mothers. Increases in labor supply among married mothers with very young children suggest that CDCC benefits may generate long-run earnings gains. II: The Effects of Welfare Time Limits on Access to Financial Resources: Evidence from the 2010s The Personal Responsibility and Work Opportunity Act of 1996 established the Temporary Assistance for Needy Families (TANF) program within the United States. TANF mandated 60-month lifetime time limits for federal cash assistance dollars. Because states reserve the right to set their own stricter or more generous time limits, the 60-month lifetime limit did not bind in many cases. In recent years, however, several states imposed TANF time limits for the first time or made existing time limits more stringent. Using administrative and survey data, I find that stricter time limits decrease annual TANF participation by 24 percent and annual transfer income by four percent. Consistent with binding TANF work requirements and increases in employment among those on the welfare caseload, stricter time limits tend to decrease employment and earnings among single mothers in states without generous TANF programs at baseline. Decreased TANF generosity diminishes these families’ access to financial resources.

Url: https://www.proquest.com/docview/2395505038/fulltextPDF/5FCEAF48DE314B26PQ/1?accountid=14586

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Authors: Pepin, Gabrielle

Institution: Michigan State University

Department: Economics - Doctor of Philosophy

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Data Collections: IPUMS USA

Topics: Family and Marriage, Labor Force and Occupational Structure, Poverty and Welfare

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