A Regional Comparative Static CGE Analysis of Subsidized Child Care
29 Pages Posted: 11 Dec 2007
Abstract
Concerns with the equity of societal income distribution typically underpin the provision of government subsidies to low-income households, in which such subsidies are commonly believed to reduce economic growth. Using a regional computable general equilibrium (CGE) model, this study examines the equity and growth aspects of subsidizing formal child care services for low-income households at the state level. The results suggest that state government subsidization of formal child care services does not necessarily reduce the level of economic activity, even when accounting for negative growth effects of tax increases required to finance the subsidies. The CGE model also reveals economic impacts on households and industry sectors not directly affected by the subsidies, impacts that would be omitted from a partial equilibrium microeconometric appraisal.
Suggested Citation: Suggested Citation
Do you have a job opening that you would like to promote on SSRN?
Recommended Papers
-
Managing Public Expenditure: Some Emerging Policy Issues and a Framework for Analysis
By Paul Atkinson and Paul Van Den Noord
-
By Ernst Verwaal and Sijbren Cnossen
-
By Andrea Bassanini, Jørn Henrik Rasmussen, ...
-
Taxes and Tradable Permits as Instruments for Controlling Pollution Theory and Practice
-
Measuring Distributional Effects of Fiscal Reforms
By Andreas Peichl and Richard R. Ochmann
-
How Progressive is Germany? Comparing the Redistributive Effects of Tax Benefit Systems in Europe
By Andreas Peichl and Thilo Schaefer
-
Consumption Versus Income Taxation: Three Moments in the Political Economy of Fiscal Choice
By Stanley L. Winer, George Warskett, ...