The Effects of the 1993 Earned Income Tax Credit Expansion on the Labor Supply of Unmarried Women
31 Pages Posted: 19 Sep 2008
Date Written: June 19, 2008
The Earned Income Tax Credit (EITC) expansion in 1993 substantially increases the maximum credits available to a family with two or more children compared to a family with one child and a family with no children. Using national survey data and this differential increase in the maximum credits, this study examines the effect of the 1993 EITC expansion on the labor supply of unmarried women. Moreover, I find evidence that previous studies may underestimate the effect of the EITC on hours of work, and therefore correct this inconsistency problem by using a Tobit model to estimate hours of work.
Keywords: Earned Income Tax Credit, Labor Supply
JEL Classification: H2, J2
Suggested Citation: Suggested Citation