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Title: The Impact and Efficiency of EITC Parameter Changes on Work

Citation Type: Miscellaneous

Publication Year: 2008

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Abstract: Previous research has affirmed the efficacy of the Earned Income Tax Credit (EITC) as a tool for increasing work participation among low-income workers without creating excessive market distortion. This study moves beyond the general effectiveness of the EITC to examine the effect and efficiency of structural parameters on work participation and weeks worked. Quantitative estimates of the benefits associated with increases in the parameters are taken from probit and tobit models are used to calculate the efficiency of changes to each parameter. Results suggest that increases in the EITC increase employment, decrease weeks worked, and affect single individuals more than married individuals. This study has significant policy impacts for lawmakers responsible for adjusting the EITC and for credit recipients

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Authors: Black, Nate

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Data Collections: IPUMS USA

Topics: Labor Force and Occupational Structure

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