Working Paper: NBER ID: w9168
Authors: Robert Moffitt
Abstract: The labor supply and other work incentive effects of welfare programs have long been a central concern in economic research. Work has also been an increasing focus of policy reforms in the U.S., culminating with a number of major policy changes in the 1990s whose intent was to increase employment and earnings levels of welfare recipients and other disadvantaged individuals. This paper reviews the economic research on this topic, covering both the theoretical models that have been developed as well as the empirical findings from econometric studies of the effects of existing welfare programs on labor supply.
Keywords: No keywords provided
JEL Codes: I13; J2
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| work requirements in welfare programs (I38) | increase employment among welfare recipients (J68) |
| higher marginal tax rates (MTRs) (H31) | lower employment rates among welfare recipients (J68) |
| lower marginal tax rates (MTRs) (H29) | higher employment rates among welfare recipients (I38) |
| eligibility status and benefit levels (I38) | influence labor supply decisions (J29) |
| welfare program structures (I38) | influence labor supply decisions (J29) |
| high marginal tax rates (H31) | disincentivize work (H31) |