Long-Run Effects of the Earned Income Tax Credit

David Neumark; Peter Shirley

Long-Run Effects of the Earned Income Tax Credit

David Neumark, Peter Shirley

Living Conditions

Research output: Working paper

Abstract

The Earned Income Tax Credit (EITC) substantially subsidizes earnings for low- to moderate-income families with children in the United States. Research has established that the EITC has positive short-term effects on the employment of less-educated single mothers and reduces overall poverty. The EITC may also generate higher earnings in the long run, as the short-run positive employment effects for low-skilled women accumulate into greater labor market experience that makes them more productive.

Original language	English
Place of Publication	San Francisco
Publisher	Federal Reserve Bank of San Francisco
Number of pages	5
Publication status	Published - 6 Jan 2020

Publication series

Name	FRBSF Economic Letter
Publisher	Federal Reserve Bank of San Francisco
No.	2020-01

Keywords

EITC
Earned Income Tax Credit
employment
United States
earnings

Access to Document

https://www.frbsf.org/economic-research/files/el2020-01.pdf

Cite this

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AB - The Earned Income Tax Credit (EITC) substantially subsidizes earnings for low- to moderate-income families with children in the United States. Research has established that the EITC has positive short-term effects on the employment of less-educated single mothers and reduces overall poverty. The EITC may also generate higher earnings in the long run, as the short-run positive employment effects for low-skilled women accumulate into greater labor market experience that makes them more productive.

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KW - employment

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KW - earnings

M3 - Working paper

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BT - Long-Run Effects of the Earned Income Tax Credit

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CY - San Francisco

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