Publication type
Journal Article
Authors
Publication date
September 15, 2016
Summary:
We estimate a dynamic model of employment, human capital accumulation—including education, and savings for women in the United Kingdom, exploiting tax and benefit reforms, and use it to analyze the effects of welfare policy. We find substantial elasticities for labor supply and particularly for lone mothers. Returns to experience, which are important in determining the longer-term effects of policy, increase with education, but experience mainly accumulates when in full-time employment. Tax credits are welfare improving in the U.K., increase lone-mother labor supply and marginally reduce educational attainment, but the employment effects do not extend beyond the period of eligibility. Marginal increases in tax credits improve welfare more than equally costly increases in income support or tax cuts.
Published in
Econometrica
Volume and page numbers
Volume: 84 , p.1 -1
DOI
http://dx.doi.org/10.3982/ECTA11576
ISSN
129682
Subjects
#524776