Taxation and Labor Force Participation: The EITC Reconsidered Henrik Kleven Princeton University and NBER October 2018
Taxation and Labor Force Participation:The EITC Reconsidered
Henrik Kleven
Princeton University and NBER
October 2018
The Extensive Margin of Labor Supply
I A consensus view that extensive margin responses are largerthan intensive margin responses
I Where does this consensus originate from?
I Early labor supply literature (Heckman 1993)
I Macro business cycle literature (Hansen 1985; Rogerson 1988)
I Labor supply literature studying EITC reform(Eissa & Liebman 1996; Meyer & Rosenbaum 2001)
I A meta study by Chetty et al. (2013) puts the extensive marginelasticity at around 0.3
2 / 167
The Earned Income Tax Credit (EITC)
I A means-tested transfer that is conditional on positive earningsand children
I A large literature studies the labor supply effects of the EITC,particularly on single mothers
I Most of this work exploits federal EITC expansions enacted in1986, 1990, and 1993
I Nichols & Rothstein (2015) summarize the consensus view:
There is remarkable consensus around a few key results (...)essentially all authors agree that the EITC expansion led tosizeable increases in single mothers’ employment rates
3 / 167
Literature
I Labor market impacts of the EITC:
Dickert, Houser & Scholz (1995), Eissa & Liebman (1996), Ellwood (2000),Meyer & Rosenbaum (2001), Neumark & Wascher (2001), Hotz & Scholz(2003), Grogger (2003), Eissa & Hoynes (2004, 2006, 2011), Cancian &Levinson (2005), Hotz, Mullin & Scholz (2006), Hoynes (2009), Rothstein(2010), Gelber & Mitchell (2012), Chetty, Friedman & Saez (2013), Looney &Manoli (2013), Bastian (2018)
I Labor market impacts of the FC/WFTC/WTC:
Blundell et al. (2000), Blundell & Hoynes (2004), Blundell, Brewer &Shepard (2005), Brewer et al. (2006), Leigh (2007), Francesconi & Klauw(2007), Francesconi, Rainer & Klaauw (2009), Gregg, Harkness & Smith(2009), Blundell et al. (2016)
4 / 167
Why Revisit This Question?
I Have I found a new source of identifying variation? (NO)
I I study EITC reforms in the US (federal and state)
I I study WFTC/WTC reforms in the UK
I Have I gained access to better data? (NO)
I I use CPS data for the US and LFS/BHPS data for the UK
I So I study the same data and reforms, but viewed through adifferent lens
I The consensus view is based on work from about 20 years ago
5 / 167
In-Work Transfers in the US and UK
6 / 167
EITC Schedule in 2017
0 children
1 child
2 children
3+ children
020
0040
0060
00An
nual
Cre
dit (
USD
)
0 10000 20000 30000 40000 50000 60000Earnings (USD)
7 / 167
EITC Maximum Credit Over Time
0 children
1 child
2 children
3+ children
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
02,
000
4,00
06,
000
Max
imum
Ann
ual C
redi
t (20
17 U
SD)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
8 / 167
EITC vs WTC Schedules in 2017Single Women with 1 Child
050
0010
000
1500
020
000
Annu
al C
redi
t (U
SD)
0 10000 20000 30000 40000 50000 60000Earnings (USD)
EITCWTC w/ childcare subsidyWTC, w/o childcare subsidy
2 Children9 / 167
WTC Maximum Credit Over Time
3 children
1 child
2 children
0 children
FIS FC WFTC WTC
010
000
2000
030
000
4000
0M
axim
um A
nnua
l Cre
dit (
2017
USD
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Child Tax Credit
10 / 167
EITC Effects on the Extensive Margin?
11 / 167
Data
I Current Population Survey (CPS), March filesI 50-year period (1968-2018)I From around 150,000 to 200,000 individuals per year
I Measures of extensive margin labor supply:
1. Employed last week
2. Participated last weekI Employed or unemployed last week
3. Employed last yearI Positive earnings last year
4. Participated last yearI Employed or unemployed for 1+ weeks last year
Extensive Margin Measures
12 / 167
Labor Force Participation of Single WomenWith and Without Children
2.6
4.6
Une
mpl
oym
ent R
ate
5060
7080
9010
0La
bor F
orce
Par
ticip
atio
n (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
Annual Employment Low Education13 / 167
Labor Force Participation of Single WomenWith and Without Children
50 years of relative stability,apart from these 5 years
2.6
4.6
Une
mpl
oym
ent R
ate
5060
7080
9010
0La
bor F
orce
Par
ticip
atio
n (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
Annual Employment Low Education14 / 167
Labor Force Participation of Single WomenWith and Without Children
14.5pp
14pp
50 years of relative stability,apart from these 5 years
2.6
4.6
Une
mpl
oym
ent R
ate
5060
7080
9010
0La
bor F
orce
Par
ticip
atio
n (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
Annual Employment Low Education15 / 167
Labor Force Participation of Single WomenWith and Without Children
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
2.6
4.6
Unem
ploy
men
t Rat
e
5060
7080
9010
0La
bor F
orce
Par
ticip
atio
n (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
Annual Employment Low Education16 / 167
Labor Force Participation of Single WomenWith and Without Children
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRAPRWORA
2.6
4.6
Unem
ploy
men
t Rat
e
5060
7080
9010
0La
bor F
orce
Par
ticip
atio
n (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
Annual Employment Low Education17 / 167
Labor Force Participation of Single WomenWith and Without Children
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRAPRWORA
State WelfareWaivers
2.6
4.6
Unem
ploy
men
t Rat
e
5060
7080
9010
0La
bor F
orce
Par
ticip
atio
n (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
Annual Employment Low Education18 / 167
Labor Force Participation of Single WomenWith and Without Children
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRAPRWORA
State WelfareWaivers
46
810
Unem
ploy
men
t Rat
e
5060
7080
9010
0La
bor F
orce
Par
ticip
atio
n (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children Unemployment
Annual Employment Low Education19 / 167
Labor Force Participation of Single WomenBy Number of Children
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
4050
6070
8090
Labo
r For
ce P
artic
ipat
ion
(%)
-1 -.5 0 .5 1
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
0 children 1 child 2 children 3+ children
Annual Employment Low Education20 / 167
Labor Force Participation of Single WomenBy Number of Children
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
Much larger increaseby those with 3+ kids40
5060
7080
90La
bor F
orce
Par
ticip
atio
n (%
)
-1 -.5 0 .5 1
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
0 children 1 child 2 children 3+ children
Annual Employment Low Education21 / 167
Labor Force Participation of Single WomenBy Number of Children
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
But no increase hereby those with 3+ kids
4050
6070
8090
Labo
r For
ce P
artic
ipat
ion
(%)
-1 -.5 0 .5 1
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
0 children 1 child 2 children 3+ children
Annual Employment Low Education22 / 167
Labor Force Participation of Single WomenBy Number of Children
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
And no increasehere either
4050
6070
8090
Labo
r For
ce P
artic
ipat
ion
(%)
-1 -.5 0 .5 1
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
0 children 1 child 2 children 3+ children
Annual Employment Low Education Skip Married23 / 167
Labor Force Participation of Married WomenWith and Without Children
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
2.6
4.6
Unem
ploy
men
t Rat
e
4050
6070
8090
Labo
r For
ce P
artic
ipat
ion
(%)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
Annual Employment Low Education 24 / 167
Labor Force Participation of Married WomenWith and Without Children (Spousal Earnings Below First Kink)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
2.6
4.6
Unem
ploy
men
t Rat
e
4050
6070
8090
Labo
r For
ce P
artic
ipat
ion
(%)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
Annual Employment Low Education Above Kink 25 / 167
Labor Force Participation of Married WomenSpousal Earnings Below and Above First Kink (Conditional on Children)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
2.6
4.6
Unem
ploy
men
t Rat
e
4050
6070
8090
Labo
r For
ce P
artic
ipat
ion
(%)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
Spousal Earnings Below Kink Spousal Earnings Above Kink
Annual Employment Low Education 26 / 167
Red Flags
The participation increase for single mothers in 1994-99 is massiveand follows the 1993 EITC reform, but...
I How do we separate EITC effects from the key confounders?
I Why do those with 3+ kids increase participation so muchmore than those with 2 kids after 1993 (but not elsewhere)?
I Why are there no visible effects for married women?
I Why are there no visible effects of the 1975, 1986, 1990, and2009 reforms?
I It is difficult to reconcile the patterns with optimization friction
1993 Reform
27 / 167
Effect of the 1975 Reform
1993 Reform28 / 167
Labor Force Participation of Single WomenWith and Without Children
Tax ReductionAct of 1975
2.6
4.6
Une
mpl
oym
ent R
ate
5060
7080
90La
bor F
orce
Par
ticip
atio
n (%
)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
With Children Without Children
Annual Employment Low Education29 / 167
Labor Force Participation of Single WomenWith and Without Children
Tax ReductionAct of 1975
46
810
Une
mpl
oym
ent R
ate
5060
7080
90La
bor F
orce
Par
ticip
atio
n (%
)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
With Children Without Children Unemployment
Annual Employment Low Education30 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
Tax ReductionAct of 1975
2.6
4.6
Une
mpl
oym
ent R
ate
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
place
Annual Employment Low Education31 / 167
1975 Reform: Conclusions
I No extensive margin effects for single women
I Business cycle variation that coincides with the reform
I This mainly affects the earnings-based measure of participation→ illusory short-term effect of the EITC
I No extensive margin effects for married women eitherMarried Women
I Reconciling these conclusions with Bastian (2018)
I Confounding effects of business cycles (single women) andsecular trends (married women) that vary by children
Bastian (2018)
32 / 167
Effect of the 1993 Reform
1975 Reform33 / 167
Empirical Specification
DiD specification:
Pist =∑j
αj · Y earj=t + β ·Kidsi +∑j
γj · Y earj=t ·Kidsi
+∑j
∑k
δkj · Y earj=t ·W ksj +
∑j
∑k
ζkj · Y earj=t ·Kidsi ·W ksj
+η · Ust + θ · Ust ·Kidsi + νist
where W kst is an indicator for state s having waiver type k in year t
and Ust is the unemployment rate in state s in year t
I Six welfare waivers: termination time limits, work-requirementtime limits, family caps, JOBS exemptions, JOBS sanctions,and earnings disregards
34 / 167
Empirical Specification
DiD specification:
Pist =∑j
αj · Y earj=t + β ·Kidsi +∑j
γj · Y earj=t ·Kidsi
+∑j
∑k
δkj · Y earj=t ·W ksj +
∑j
∑k
ζkj · Y earj=t ·Kidsi ·W ksj
+η · Ust + θ · Ust ·Kidsi + νist
where W kst is an indicator for state s having waiver type k in year t
and Ust is the unemployment rate in state s in year t
I Six welfare waivers: termination time limits, work-requirementtime limits, family caps, JOBS exemptions, JOBS sanctions,and earnings disregards
35 / 167
Empirical Specification
DiD specification:
Pist =∑j
αj · Y earj=t + β ·Kidsi +∑j
γj · Y earj=t ·Kidsi
+∑j
∑k
δkj · Y earj=t ·W ksj +
∑j
∑k
ζkj · Y earj=t ·Kidsi ·W ksj
+η · Ust + θ · Ust ·Kidsi + νist
where W kst is an indicator for state s having waiver type k in year t
and Ust is the unemployment rate in state s in year t
I Six welfare waivers: termination time limits, work-requirementtime limits, family caps, JOBS exemptions, JOBS sanctions,and earnings disregards
36 / 167
Labor Force Participation of Single WomenWith and Without Children
OBRA93TRA86 OBRA90 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
6070
8090
Labo
r For
ce P
artic
ipat
ion
(%)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
With Children Without Children
Annual Participation Weekly Employment Annual Employment Low Education With 1 and 2+ Children37 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
place
Annual Participation Weekly Employment Annual Employment Low Education With 1 and 2+ Children38 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Controlling for State Unemployment)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
Raw Means With Controls
Annual Participation Weekly Employment Annual Employment Low Education With 1 and 2+ Children39 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Controlling for State Unemployment and Welfare Waivers)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
Raw Means With Controls
Annual Participation Weekly Employment Annual Employment Low Education With 1 and 2+ Children
Any Waiver Approved Any Waiver Implemented 40 / 167
1993 Reform: Conclusions
I The participation increase for single mothers is correlated withunemployment changes and welfare waivers across states
I Controlling for state-level variation in unemployment andwelfare waivers eliminates any significant effect of the EITCbetween 1994-96 (prior to PRWORA)
I A weak test as it absorbs only cross-state effects, not anynational effects
I The drivers of the 1990s participation boom are unidentified,but the patterns are consistent with no effect of the EITC
WFTC
41 / 167
State EITC Supplements
WFTC 42 / 167
State EITC Supplements
I Between 1984-2018, many states instituted EITC supplements
I 28 states currently have EITC supplements
I Many supplements are small or were increased only gradually
I Some states implemented larger reforms
I Define “large reform” as an increase in the state EITC of atleast 20% (refundable) of the federal credit within 3 years
I 8 states had such reforms
43 / 167
States with an EITC Supplement in 1990
Any SupplementNo Supplement
44 / 167
States with an EITC Supplement in 2000
Any SupplementNo Supplement
45 / 167
States with an EITC Supplement in 2010
Any SupplementNo Supplement
46 / 167
States with an EITC Supplement in 2018
Any SupplementNo Supplement
47 / 167
States with an EITC Supplement in 2018
2015
2011
2000
1998
2000
1994
1988
1989
Large ReformAny SupplementNo Supplement
48 / 167
Synthetic Control Approach
I For each state with an EITC supplement, a synthetic controlstate is created from those without a supplement
I I focus on state reforms:
I Introduction of any state EITC supplement
I Large reforms, as defined earlier
I I match on pre-reform variables:
I Labor force participation (level and trend), unemployment rate(level and change), and welfare participation rate
Synthetic States
49 / 167
Specification
DiD specification:
Pst =∑j
αj · Eventj=t + β · Treats +∑j
γj · Eventj=t · Treats
+λs + νst
where Eventj=t are event time indicators, Treats is an indicator forbeing a treatment state, and λs is a state fixed effect
I The specification is run on an unbalanced panel of states overan event window from -10 to +10
50 / 167
Large State EITC Reforms: Event StudyTreatment and Synthetic Control States
Reform
-20
-15
-10
-50
510
1520
Labo
r For
ce P
artic
ipat
ion
(%)
-10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10Year
Treatments Synthetic Controls
All Reforms Annual Participation Weekly Employment Annual Employment
51 / 167
Large State EITC Reforms: Event StudyDiD: Difference Between Treatment and Synthetic Control States
Reform
-20
-15
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
-10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10Year
place
Placebos All Reforms Annual Participation Weekly Employment Annual Employment
52 / 167
State EITC Supplements: Conclusions
I State EITCs create variation that does not rely on children
I This avoids confounders that vary by children
I But introduces confounders that vary by state→ synthetic control approach
I Most state EITC reforms have been too small for a credibleDiD, but 8 reforms were sizeable
I Evidence from large state EITC reforms:
I No clear evidence of any extensive margin effects
53 / 167
WFTC Effects on the Extensive Margin?
54 / 167
Data
I Main data: Labour Force Survey (LFS):
I Repeated cross-section
I 1992-2017
I Around 400,000 individuals per year
I Alternate data: British Household Panel Survey (BHPS):
I Panel
I 1991-2008
I Started with 10,000 individuals in 1991
55 / 167
Empirical Specification
DiD specification:
Pirt =∑j
αj · Y earj=t + β ·Kidsi +∑j
γj · Y earj=t ·Kidsi
+δ · Urt + ζ · Urt ·Kidsi +Xi · φ+Xi ·Kidsi · ψ + νirt
where Urt is the unemployment rate in region r in year t, and Xi
includes dummies for age, age of youngest child, and education
I Allow for linear, group-specific pre-trend, i.e. residualize Pirt
using linear trend estimated on pre-data
56 / 167
Labor Force Participation of Single WomenWith and Without Children
WFTC WTC
4050
6070
8090
100
Labo
r For
ce P
artic
ipat
ion
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
With Children Without Children
Low Education Employment (All Edu) Employment (Low Edu)57 / 167
Labor Force Participation of Single WomenWith and Without Children
(Normalized)
WFTC WTC
-20
-10
010
2030
Labo
r For
ce P
artic
ipat
ion
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
With Children Without Children
Low Education Employment (All Edu) Employment (Low Edu)58 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
WFTC WTC
-10
010
20Im
pact
on
Labo
r For
ce P
artic
ipat
ion
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
place
Low Education Employment (All Edu) Employment (Low Edu)59 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Adding Linear Pre-Trends)
WFTC WTC
-10
010
20Im
pact
on
Labo
r For
ce P
artic
ipat
ion
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
Raw Means With Pre-Trends
Low Education Employment (All Edu) Employment (Low Edu)60 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Controlling for Unemployment and Demographics)
WFTC WTC
-10
010
20Im
pact
on
Labo
r For
ce P
artic
ipat
ion
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
Raw Means With Controls
Low Education Employment (All Edu) Employment (Low Edu)61 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Adding Pre-Trend Controls)
WFTC WTC
-10
010
20Im
pact
on
Labo
r For
ce P
artic
ipat
ion
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
Raw Means With Controls & Pre-Trends
Low Education Employment (All Edu) Employment (Low Edu)62 / 167
1999 WFTC Reform: Findings and Issues
I The real size of the 1999 WFTC expansion:
I The WFTC expansion was massive in itself, but there wereoffsetting changes from the welfare system
I Still, a sizeable net incentive for the typical single mother(e.g., Blundell & Hoynes 2004)
I The effects on the extensive margin of labor supply:
I No effects on labor force participation
I This holds in both LFS and BHPS BHPS
I Suggestive effects on employment
I DiD effect driven by break in the control group → parallel trendassumption is tenuous
63 / 167
Conclusions
64 / 167
Where Does This Leave Us?
I A consensus view that participation responses can be sizeableI This view is partly grounded in EITC studies
I But no study identifies these responses to a modern bar
I Cross-country puzzle (Kleven 2014)
I Revisiting historical EITC and WFTC reforms, I find no clearevidence of participation responses
I What happened with single mothers in the US in the 1990s?I Maybe a unique combination of EITC reform, welfare reform,
economic upturn, and changing social norms?
I Economic history rather than anything externally valid
65 / 167
Appendix
66 / 167
WTC Maximum Credit Over TimeSingle Women with 2 Children
050
0010
000
1500
020
000
2500
0An
nual
Cre
dit (
USD
)
0 10000 20000 30000 40000 50000 60000Earnings (USD)
EITCWTC w/ childcare subsidyWTC, w/o childcare subsidy
Back67 / 167
WTC Maximum Credit Over TimeIncluding the Child Tax Credit
1 child
2 children3 children
0 children
FIS FC WFTC WTC
010
000
2000
030
000
4000
050
000
Max
imum
Ann
ual C
redi
t (20
17 U
SD)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
Back
68 / 167
Extensive Margin MeasuresAll Women, 20-50
2.6
4.6
Une
mpl
oym
ent R
ate
4050
6070
80
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
Employed last weekParticipated last weekEmployed last yearParticipated last year
Back
69 / 167
Extensive Margin MeasuresSingle Women, 20-50
2.6
4.6
Une
mpl
oym
ent R
ate
5060
7080
90
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
Employed last weekParticipated last weekEmployed last yearParticipated last year
Back
70 / 167
Extensive Margin MeasuresSingle Mothers, 20-50
2.6
4.6
Une
mpl
oym
ent R
ate
5060
7080
90
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
Employed last weekParticipated last weekEmployed last yearParticipated last year
Back
71 / 167
Labor Force Participation of Single WomenWith and Without Children
(Annual Employment)
2.5
4.5
Une
mpl
oym
ent R
ate
5060
7080
9010
0Po
sitiv
e Ea
rnin
gs (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
LFP72 / 167
Labor Force Participation of Single WomenWith and Without Children
(Annual Employment)
50 years of relative stability,apart from these 7 years
2.5
4.5
Une
mpl
oym
ent R
ate
5060
7080
9010
0Po
sitiv
e Ea
rnin
gs (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
LFP73 / 167
Labor Force Participation of Single WomenWith and Without Children
(Annual Employment)
14.9pp 14.9pp
50 years of relative stability,apart from these 7 years
2.5
4.5
Une
mpl
oym
ent R
ate
5060
7080
9010
0Po
sitiv
e Ea
rnin
gs (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
LFP74 / 167
Labor Force Participation of Single WomenWith and Without Children
(Annual Employment)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
2.5
4.5
Unem
ploy
men
t Rat
e
5060
7080
9010
0Po
sitive
Ear
ning
s (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
LFP75 / 167
Labor Force Participation of Single WomenWith and Without Children
(Annual Employment)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRAPRWORA
2.5
4.5
Unem
ploy
men
t Rat
e
5060
7080
9010
0Po
sitive
Ear
ning
s (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
LFP76 / 167
Labor Force Participation of Single WomenWith and Without Children
(Annual Employment)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRAPRWORA
State WelfareWaivers
2.5
4.5
Unem
ploy
men
t Rat
e
5060
7080
9010
0Po
sitive
Ear
ning
s (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
LFP77 / 167
Labor Force Participation of Single WomenWith and Without Children
(Annual Employment)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRAPRWORA
State WelfareWaivers
46
810
Unem
ploy
men
t Rat
e
5060
7080
9010
0Po
sitive
Ear
ning
s (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children Unemployment
LFP78 / 167
Labor Force Participation of Single WomenBy Number of Children(Annual Employment)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
4050
6070
8090
Posit
ive E
arni
ngs
(%)
-1 -.5 0 .5 1
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
0 children 1 child 2 children 3+ children
LFP79 / 167
Labor Force Participation of Single WomenBy Number of Children(Annual Employment)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
Much larger increaseby those with 3+ kids40
5060
7080
90Po
sitive
Ear
ning
s (%
)
-1 -.5 0 .5 1
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
0 children 1 child 2 children 3+ children
LFP80 / 167
Labor Force Participation of Single WomenBy Number of Children(Annual Employment)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
But no increase hereby those with 3+ kids
4050
6070
8090
Posit
ive E
arni
ngs
(%)
-1 -.5 0 .5 1
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
0 children 1 child 2 children 3+ children
LFP81 / 167
Labor Force Participation of Single WomenBy Number of Children(Annual Employment)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
And no increasehere either
4050
6070
8090
Posit
ive E
arni
ngs
(%)
-1 -.5 0 .5 1
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
0 children 1 child 2 children 3+ children
LFP82 / 167
Labor Force Participation of Married WomenWith and Without Children
(Annual Employment)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
2.5
4.5
Unem
ploy
men
t Rat
e
4050
6070
8090
Posit
ive E
arni
ngs
(%)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
LFP 83 / 167
Labor Force Participation of Married WomenWith and Without Children (Spousal Earnings Below First Kink)
(Annual Employment)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
2.5
4.5
Unem
ploy
men
t Rat
e
4050
6070
8090
Posit
ive E
arni
ngs
(%)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
LFP 84 / 167
Labor Force Participation of Married WomenSpousal Earnings Below and Above First Kink (Conditional on Children)
(Annual Employment)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
2.5
4.5
Unem
ploy
men
t Rat
e
4050
6070
8090
Posit
ive E
arni
ngs
(%)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
Spousal Earnings Below Kink Spousal Earnings Above Kink
LFP 85 / 167
Labor Force Participation of Single WomenWith and Without Children
(Low Education)
2.6
4.6
Une
mpl
oym
ent R
ate
5060
7080
9010
0La
bor F
orce
Par
ticip
atio
n (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
All Educations86 / 167
Labor Force Participation of Single WomenWith and Without Children
(Low Education)
50 years of relative stability,apart from these 5 years
2.6
4.6
Une
mpl
oym
ent R
ate
5060
7080
9010
0La
bor F
orce
Par
ticip
atio
n (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
All Educations87 / 167
Labor Force Participation of Single WomenWith and Without Children
(Low Education)
20.8pp 16.8pp
50 years of relative stability,apart from these 5 years
2.6
4.6
Une
mpl
oym
ent R
ate
5060
7080
9010
0La
bor F
orce
Par
ticip
atio
n (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
All Educations88 / 167
Labor Force Participation of Single WomenWith and Without Children
(Low Education)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
2.6
4.6
Unem
ploy
men
t Rat
e
5060
7080
9010
0La
bor F
orce
Par
ticip
atio
n (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
All Educations89 / 167
Labor Force Participation of Single WomenWith and Without Children
(Low Education)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRAPRWORA
2.6
4.6
Unem
ploy
men
t Rat
e
5060
7080
9010
0La
bor F
orce
Par
ticip
atio
n (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
All Educations90 / 167
Labor Force Participation of Single WomenWith and Without Children
(Low Education)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRAPRWORA
State WelfareWaivers
2.6
4.6
Unem
ploy
men
t Rat
e
5060
7080
9010
0La
bor F
orce
Par
ticip
atio
n (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
All Educations91 / 167
Labor Force Participation of Single WomenWith and Without Children
(Low Education)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRAPRWORA
State WelfareWaivers
46
810
Unem
ploy
men
t Rat
e
5060
7080
9010
0La
bor F
orce
Par
ticip
atio
n (%
)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children Unemployment
All Educations92 / 167
Labor Force Participation of Single WomenBy Number of Children
(Low Education)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
4050
6070
8090
Labo
r For
ce P
artic
ipat
ion
(%)
-1 -.5 0 .5 1
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
0 children 1 child 2 children 3+ children
All Educations93 / 167
Labor Force Participation of Single WomenBy Number of Children
(Low Education)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
Much larger increaseby those with 3+ kids
4050
6070
8090
Labo
r For
ce P
artic
ipat
ion
(%)
-1 -.5 0 .5 1
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
0 children 1 child 2 children 3+ children
All Educations94 / 167
Labor Force Participation of Single WomenBy Number of Children
(Low Education)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
But no increase hereby those with 3+ kids
4050
6070
8090
Labo
r For
ce P
artic
ipat
ion
(%)
-1 -.5 0 .5 1
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
0 children 1 child 2 children 3+ children
All Educations95 / 167
Labor Force Participation of Single WomenBy Number of Children
(Low Education)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
And no increasehere either40
5060
7080
90La
bor F
orce
Par
ticip
atio
n (%
)
-1 -.5 0 .5 1
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
0 children 1 child 2 children 3+ children
All Educations96 / 167
Labor Force Participation of Married WomenWith and Without Children
(Low Education)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
2.6
4.6
Unem
ploy
men
t Rat
e
4050
6070
8090
Labo
r For
ce P
artic
ipat
ion
(%)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
All Educations 97 / 167
Labor Force Participation of Married WomenWith and Without Children (Spousal Earnings Below First Kink)
(Low Education)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
2.6
4.6
Unem
ploy
men
t Rat
e
4050
6070
8090
Labo
r For
ce P
artic
ipat
ion
(%)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
All Educations 98 / 167
Labor Force Participation of Married WomenSpousal Earnings Below and Above First Kink (Conditional on Children)
(Low Education)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
2.6
4.6
Unem
ploy
men
t Rat
e
4050
6070
8090
Labo
r For
ce P
artic
ipat
ion
(%)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
Spousal Earnings Below Kink Spousal Earnings Above Kink
All Educations 99 / 167
Labor Force Participation of Married WomenWith and Without Children (Spousal Earnings Above First Kink)
Tax ReductionAct of 1975 TRA86 OBRA90 OBRA93 ARRA
2.6
4.6
Unem
ploy
men
t Rat
e
4050
6070
8090
Labo
r For
ce P
artic
ipat
ion
(%)
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18Year
With Children Without Children
Back 100 / 167
Labor Force Participation of Single WomenWith and Without Children
(Annual Employment)
Tax ReductionAct of 1975
2.6
4.6
Une
mpl
oym
ent R
ate
5060
7080
90Po
sitiv
e Ea
rnin
gs (%
)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
With Children Without Children
LFP101 / 167
Labor Force Participation of Single WomenWith and Without Children
(Annual Employment)
Tax ReductionAct of 1975
46
810
Une
mpl
oym
ent R
ate
5060
7080
90Po
sitiv
e Ea
rnin
gs (%
)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
With Children Without Children Unemployment
LFP102 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Annual Employment)
Tax ReductionAct of 1975
46
810
Une
mpl
oym
ent R
ate
-10
-50
510
1520
Impa
ct o
n Po
sitiv
e Ea
rnin
gs (%
)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
DiD Unemployment
LFP103 / 167
Labor Force Participation of Single WomenWith and Without Children
(Low Education)
Tax ReductionAct of 1975
2.6
4.6
Une
mpl
oym
ent R
ate
5060
7080
90La
bor F
orce
Par
ticip
atio
n (%
)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
With Children Without Children
All Educations104 / 167
Labor Force Participation of Single WomenWith and Without Children
(Low Education)
Tax ReductionAct of 1975
46
810
Une
mpl
oym
ent R
ate
5060
7080
90La
bor F
orce
Par
ticip
atio
n (%
)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
With Children Without Children Unemployment
All Educations105 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Low Education)
Tax ReductionAct of 1975
2.6
4.6
Une
mpl
oym
ent R
ate
-10
-50
510
15Im
pact
on
Labo
r For
ce P
artic
ipat
ion
(%)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
place
All Educations106 / 167
Labor Force Participation of Married WomenWith and Without Children
(Spousal Earnings Below First Kink)
Tax ReductionAct of 1975
2.6
4.6
Une
mpl
oym
ent R
ate
3545
5565
7585
Labo
r For
ce P
artic
ipat
ion
(%)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
With Children Without Children
Back107 / 167
Labor Force Participation of Married WomenWith and Without Children
(Spousal Earnings Above First Kink)
Tax ReductionAct of 1975
2.6
4.6
Une
mpl
oym
ent R
ate
3545
5565
7585
Labo
r For
ce P
artic
ipat
ion
(%)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
With Children Without Children
Back108 / 167
Labor Force Participation of Married WomenTriple-Diff: With and Without Children, Below and Above Kink
Tax ReductionAct of 1975
2.6
4.6
Une
mpl
oym
ent R
ate
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
place
Back109 / 167
Bastian ReplicationSingle Women and Married Women with Spousal Earnings Below EITC Exhaustion
Tax ReductionAct of 1975
2.6
4.6
Une
mpl
oym
ent R
ate
4050
6070
8090
Posi
tive
Earn
ings
(%)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
With Children Without Children
Back110 / 167
Refining the SpecificationSingle Women and Married Women with Spousal Earnings Below First EITC Kink
Tax ReductionAct of 1975
2.6
4.6
Une
mpl
oym
ent R
ate
4050
6070
8090
Posi
tive
Earn
ings
(%)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
With Children Without Children
Back111 / 167
Adding the Unemployment SeriesSingle Women and Married Women with Spousal Earnings Below First EITC Kink
Tax ReductionAct of 1975
46
810
Une
mpl
oym
ent R
ate
4050
6070
8090
Posi
tive
Earn
ings
(%)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
With Children Without Children Unemployment
Back112 / 167
Splitting the Sample
Single Women Married Women(Spousal Earnings Below First Kink)
Tax ReductionAct of 1975
46
810
Une
mpl
oym
ent R
ate
4050
6070
8090
Posi
tive
Earn
ings
(%)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
With Children Without Children Unemployment
Tax ReductionAct of 1975
46
810
Une
mpl
oym
ent R
ate
4050
6070
8090
Posi
tive
Earn
ings
(%)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
With Children Without Children Unemployment
Back 113 / 167
Married Women Placebo Test
Married Women Married Women(Spousal Earnings Below First Kink) (Spousal Earnings Above First Kink)
Tax ReductionAct of 1975
46
810
Une
mpl
oym
ent R
ate
4050
6070
8090
Posi
tive
Earn
ings
(%)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
With Children Without Children Unemployment
Tax ReductionAct of 1975
46
810
Une
mpl
oym
ent R
ate
4050
6070
8090
Posi
tive
Earn
ings
(%)
68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85Year
With Children Without Children Unemployment
Back 114 / 167
Labor Force Participation of Single WomenWith and Without Children
(Annual Participation)
OBRA93TRA86 OBRA90 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
6575
8595
Labo
r For
ce P
artic
ipat
ion
(%)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
With Children Without Children
Weekly Participation115 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Annual Participation)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
place
Weekly Participation116 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Annual Participation, Unemployment Controls)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
Raw Means With Controls
Weekly Participation117 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Annual Participation, Unemployment and Welfare Waiver Controls)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
Raw Means With Controls
Weekly Participation
118 / 167
Labor Force Participation of Single WomenWith and Without Children
(Weekly Employment)
OBRA93TRA86 OBRA90 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
5565
7585
Empl
oym
ent R
ate
(%)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
With Children Without Children
Weekly Participation119 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Weekly Employment)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n Em
ploy
men
t Rat
e (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
place
Weekly Participation120 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Weekly Employment, Unemployment Controls)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n Em
ploy
men
t Rat
e (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
Raw Means With Controls
Weekly Participation121 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Weekly Employment, Unemployment and Welfare Waiver Controls)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n Em
ploy
men
t Rat
e (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
Raw Means With Controls
Weekly Participation
122 / 167
Labor Force Participation of Single WomenWith and Without Children
(Annual Employment)
OBRA93TRA86 OBRA90 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
6070
8090
Posit
ive E
arni
ngs
(%)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
With Children Without Children
Weekly Participation123 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Annual Employment)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n Po
sitive
Ear
ning
s (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
place
Weekly Participation124 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Annual Employment, Unemployment Controls)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n Po
sitive
Ear
ning
s (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
Raw Means With Controls
Weekly Participation125 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Annual Employment, Unemployment and Welfare Waiver Controls)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n Po
sitive
Ear
ning
s (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
Raw Means With Controls
Weekly Participation
126 / 167
Labor Force Participation of Single WomenWith and Without Children
(Low Education)
OBRA93TRA86 OBRA90 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
6070
8090
Labo
r For
ce P
artic
ipat
ion
(%)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
With Children Without Children
All Educations127 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Low Education)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
place
All Educations128 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Low Education, Unemployment Controls)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
Raw Means With Controls
All Educations129 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Low Education, Unemployment and Welfare Waiver Controls)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
Raw Means With Controls
All Educations130 / 167
Labor Force Participation of Single WomenWith 1 and 2+ Children
OBRA93TRA86 OBRA90 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
5565
7585
Labo
r For
ce P
artic
ipat
ion
(%)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
1 child 2+ children
With and Without Children131 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With 1 and 2+ Children
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
place
With and Without Children132 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With 1 and 2+ Children
(Unemployment Controls)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
Raw Means With Controls
With and Without Children133 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With 1 and 2+ Children
(Unemployment and Welfare Waiver Controls)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
Raw Means With Controls
With and Without Children134 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Any Waiver Approved, Unemployment and Welfare Waiver Controls)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
Raw Means With Controls
All Waivers
135 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Any Waiver Implemented, Unemployment and Welfare Waiver Controls)
OBRA93 PRWORA
8.6
10.6
Unem
ploy
men
t Rat
e
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03Year
Raw Means With Controls
All Waivers
136 / 167
Synthetic StatesI California: 40% Alabama, 29% Arizona, 27% Nevada, 3% Montana, 2%
Washington
I Connecticut: 26% Missouri, 14% South Dakota, 9% Texas, 9%Tennessee, 7% Alaska, 35% other states
I DC: 54% Alaska, 46% Kentucky
I Minnesota: 61% Pennsylvania, 39% Tennessee
I New Jersey: 25% Kentucky, 21% Alaska, 18% New Hampshire, 13%Arizona, 11% Montana, 12% other states
I New York: 51% Pennsylvania, 49% West Virginia
I Vermont: 61% Washington, 31% Arkansas, 8% Pennsylvania
I Wisconsin: 53% Washington, 27% Pennsylvania, 20% Missouri
Back
137 / 167
All State EITC Introductions: Event StudyTreatment and Synthetic Control States
Reform
-20
-15
-10
-50
510
1520
Labo
r For
ce P
artic
ipat
ion
(%)
-10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10Year
Treatments Synthetic Controls
Large Reforms
138 / 167
All State EITC Introductions: Event StudyDiD: Difference Between Treatment and Synthetic Control States
Reform
-20
-15
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
-10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10Year
place
Large Reforms
139 / 167
Large State EITC Reforms: Event StudyTreatment and Synthetic Control States
(Annual Participation)
Reform
-20
-15
-10
-50
510
1520
Labo
r For
ce P
artic
ipat
ion
(%)
-10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10Year
Treatments Synthetic Controls
Weekly Participation
140 / 167
Large State EITC Reforms: Event StudyDiD: Difference Between Treatment and Synthetic Control States
(Annual Participation)
Reform
-20
-15
-10
-50
510
1520
Impa
ct o
n La
bor F
orce
Par
ticip
atio
n (%
)
-10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10Year
place
Weekly Participation
141 / 167
Large State EITC Reforms: Event StudyTreatment and Synthetic Control States
(Weekly Employment)
Reform
-20
-15
-10
-50
510
1520
Empl
oym
ent R
ate
(%)
-10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10Year
Treatments Synthetic Controls
Weekly Participation
142 / 167
Large State EITC Reforms: Event StudyDiD: Difference Between Treatment and Synthetic Control States
(Weekly Employment)
Reform
-20
-15
-10
-50
510
1520
Impa
ct o
n Em
ploy
men
t Rat
e (%
)
-10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10Year
place
Weekly Participation
143 / 167
Large State EITC Reforms: Event StudyTreatment and Synthetic Control States
(Annual Employment)
Reform
-20
-15
-10
-50
510
1520
Empl
oym
ent R
ate
(%)
-10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10Year
Treatments Synthetic Controls
Weekly Participation
144 / 167
Large State EITC Reforms: Event StudyDiD: Difference Between Treatment and Synthetic Control States
(Annual Employment)
Reform
-20
-15
-10
-50
510
1520
Impa
ct o
n Em
ploy
men
t Rat
e (%
)
-10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10Year
place
Weekly Participation
145 / 167
Large State EITC Reforms: Event StudyActual DiD Estimates vs Placebo DiD Estimates
Reform
-40
-30
-20
-10
010
2030
40
-10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10Year
Actual Estimates Placebo Estimates
Back
146 / 167
Labor Force Participation of Single WomenWith and Without Children
(Low Education)
WFTC WTC
4050
6070
8090
100
Labo
r For
ce P
artic
ipat
ion
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
With Children Without Children
All Educations147 / 167
Labor Force Participation of Single WomenWith and Without Children
(Low Education, Normalized)
WFTC WTC
-20
-10
010
2030
Labo
r For
ce P
artic
ipat
ion
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
With Children Without Children
All Educations148 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Low Education)
WFTC WTC
-10
010
20Im
pact
on
Labo
r For
ce P
artic
ipat
ion
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
place
All Educations149 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Low Education, Adding Linear Pre-Trends)
WFTC WTC
-10
010
20Im
pact
on
Labo
r For
ce P
artic
ipat
ion
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
Raw Means With Pre-Trends
All Educations150 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Low Education, Controlling for Unemployment and Demographics)
WFTC WTC
-10
010
20Im
pact
on
Labo
r For
ce P
artic
ipat
ion
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
Raw Means With Controls
All Educations151 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Low Education, Adding Pre-Trend Controls)
WFTC WTC
-10
010
20Im
pact
on
Labo
r For
ce P
artic
ipat
ion
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
Raw Means With Controls & Pre-Trends
All Educations152 / 167
Labor Force Participation of Single WomenWith and Without Children(Employment, All Edu)
WFTC WTC
4050
6070
8090
100
Empl
oyem
ent R
ate
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
With Children Without Children
LFP153 / 167
Labor Force Participation of Single WomenWith and Without Children
(Employment, All Educations, Normalized)
WFTC WTC
-20
-10
010
2030
Empl
oyem
ent R
ate
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
With Children Without Children
LFP154 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Employment, All Educations)
WFTC WTC
-10
010
20Im
pact
on
Empl
oym
ent R
ate
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
place
LFP155 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Employment, All Educations, Adding Linear Pre-Trends)
WFTC WTC
-10
010
20Im
pact
on
Empl
oym
ent R
ate
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
Raw Means With Pre-Trends
LFP156 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Employment, All Educations, Controlling for Unemployment and Demographics)
WFTC WTC
-10
010
20Im
pact
on
Empl
oym
ent R
ate
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
Raw Means With Controls
LFP157 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Employment, All Educations, Adding Pre-Trend Controls)
WFTC WTC
-10
010
20Im
pact
on
Empl
oym
ent R
ate
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
Raw Means With Controls & Pre-Trends
LFP158 / 167
Labor Force Participation of Single WomenWith and Without Children
(Employment, Low Education)
WFTC WTC
3040
5060
7080
90Em
ploy
emen
t Rat
e (%
)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
With Children Without Children
LFP (All Edu)159 / 167
Labor Force Participation of Single WomenWith and Without Children
(Employment, Low Education, Normalized)
WFTC WTC
-20
-10
010
2030
Empl
oyem
ent R
ate
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
With Children Without Children
LFP (All Edu)160 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Employment, Low Education)
WFTC WTC
-10
010
20Im
pact
on
Empl
oym
ent R
ate
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
place
LFP (All Edu)161 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Employment, Low Education, Adding Linear Pre-Trends)
WFTC WTC
-10
010
20Im
pact
on
Empl
oym
ent R
ate
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
Raw Means With Pre-Trends
LFP (All Edu)162 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Employment, Low Education, Controlling for Unemployment and Demographics)
WFTC WTC
-10
010
20Im
pact
on
Empl
oym
ent R
ate
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
Raw Means With Controls
LFP (All Edu)163 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(Employment, Low Education, Adding Pre-Trend Controls)
WFTC WTC
-10
010
20Im
pact
on
Empl
oym
ent R
ate
(%)
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15Year
Raw Means With Controls & Pre-Trends
LFP (All Edu)164 / 167
Labor Force Participation of Single WomenWith and Without Children
(BHPS, Normalized)
WFTC WTC
-20
-10
010
20La
bor F
orce
Par
ticip
atio
n (%
)
92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08Year
With Children Without Children
Back165 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(BHPS)
WFTC WTC
-20
-10
010
20La
bor F
orce
Par
ticip
atio
n (%
)
92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08Year
place
Back166 / 167
Labor Force Participation of Single WomenDiD: Difference Between Those With and Without Children
(BHPS, Controlling for Demographics)
WFTC WTC
-20
-10
010
20La
bor F
orce
Par
ticip
atio
n (%
)
92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08Year
Raw Means With Controls
Back167 / 167