Working Paper: NBER ID: w20580
Authors: Casey B. Mulligan
Abstract: The Affordable Care Act introduces or expands taxes on incomes and full-time employment, beginning in 2014. The purpose of this paper is to characterize the new full-time employment taxes from the perspective of a household budget constraint, measure their magnitude, and assess their likely consequences for employee work schedules. When the ACA is fully implemented, full-time employment taxes will be prevalent and often as large as what workers can earn in five hours of work per week, 52 weeks per year. The economic significance of the ACA's full-time employment taxes varies by demographic group: they are non-monotonic in age, increasing with family size, and negatively correlated with schooling.
Keywords: Affordable Care Act; fulltime employment taxes; labor supply; household budget constraints
JEL Codes: H24; I13; J22
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| FTETs (Y20) | full-time employment (J22) |
| employer penalty (J32) | full-time positions (M51) |
| FTETs (Y20) | hours worked (J22) |
| employer penalty (J32) | employment decisions (M51) |
| FTETs (Y20) | employee behavior (M51) |
| FTETs (Y20) | financial disincentive for full-time employment (J32) |