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Author: Hoynes, Hilary Williamson
Resulting in 2 citations.
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Eissa, Nada Hoynes, Hilary Williamson |
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Tax and Transfer Policy, and Family Formation: Marriage and Cohabitation Working Paper, Department of Economics, University of California, Berkeley and NBER, December 2000. Also: http://www9.georgetown.edu/faculty/noe/cohabitation_paper.pdf Cohort(s): NLSY79 Publisher: Department of Economics, University of California, Berkeley Keyword(s): Divorce; Earned Income Tax Credit (EITC); Family Formation; Family Income; Family Size; Family Studies; Marriage; Taxes Permission to reprint the abstract has not been received from the publisher. The American family has gone through major transformations over the past 4 decades. Over this period, the age of first marriage, the rate of divorce, and the rate of out-of-wedlock births have risen dramatically. Not only have individuals delayed marriage, they have increasingly forgone marriage altogether: the proportion of those of those reporting never having married has increased at older ages, especially among the less educated. Several explanations have been given for this transformation, including declining labor market opportunities for less skilled males, rising employment of women, legalization of abortion, changing norms and the welfare system. In fact, these changes have sustained the popular criticism that public assistance programs undermine the traditional family through their adverse incentives for creating and maintaining two- parent families. Indeed, empirical evidence supports the view that welfare has some role in family structure decisions (Moffitt 1998, Hoynes 1997b). Less recognized is the potential effect of the tax system on family formation. Unlike most other industrialized countries, the U.S. federal income tax code is based on family rather than individual income (Engelhardt and Pechman 1990). Because the tax schedule is progressive, it is not marriage neutral. By nonmarriage neutrality, it is meant that the tax liability for a married couple differs from the total tax liability of 2 unmarried individuals with the same total income and family size. Unlike the transfer system, the federal (and state) income tax code can either tax or subsidize marriage depending on the size and earnings of the family. Recently, there has been renewed interest in the impact of the tax system on the so-called “marriage penalty”. Proposals to address this "penalty" include increasing the size of the 15 percent tax bracket for married couples, a deduction for secondary earnings in the households and increasing the maximum income for a marri ed couple to be eligible for the Earned Income Tax Credit . […] This paper is organized as follows. Section 2 presents a brief overview and discussion of tax and transfer schemes and the implications of marriage. Section 3 presents the data and descriptive evidence on the tax and transfer consequences of marriage. The conceptual and empirical frameworks typically used for marriage analysis are presented in section 4. Our regression results are in section 5. We present our conclusions in section 6. |
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Bibliography Citation
Eissa, Nada and Hilary Williamson Hoynes. "Tax and Transfer Policy, and Family Formation: Marriage and Cohabitation." Working Paper, Department of Economics, University of California, Berkeley and NBER, December 2000. |
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Hoynes, Hilary Williamson |
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Does Welfare Play Any Role in Female Headship Decisions? Discussion Paper No. 1078-95, Institute for Research on Poverty, September 1995. Also: http://www.irp.wisc.edu/publications/dps/pdfs/dp107895.pdf Cohort(s): NLSY79 Publisher: Institute for Research on Poverty (IRP), University of Wisconsin - Madison Keyword(s): Aid for Families with Dependent Children (AFDC); Endogeneity; Family Structure; Household Composition; Racial Differences; Welfare Permission to reprint the abstract has not been received from the publisher. During the last thirty years, the composition of white and black families in the United States has changed dramatically. In 1960, less than 10 percent of families with children were headed by a single mother, while in 1990 more than 20 percent of families with children were female-headed households. A large body of research has focused on the role of the U.S. welfare system, and in particular, the Aid to Families with Dependent Children (AFDC) program, in contributing to these dramatic changes in family structure. Most studies use cross-sectional data and identify the effect of welfare on female headship through interstate variation in the AFDC program. Recent research finds that controlling for state effects has a large impact on the estimated welfare effect. This paper examines why state effects matter for estimating the role of welfare in female headship decisions by examining the importance of individual effects and policy endogeneity. A natural explanation for why state effects matter is that the composition of the population across the states differs, and the composition is related to the generosity of the state's welfare program. If that is true, then controlling for individual effects should have the same result as controlling for state effects. Second, the endogeneity of AFDC policy is examined by including controls representing the determinants of state welfare generosity. The results show that after controlling for individual effects, there is no evidence that welfare contributes to increasing propensities to form female-headed households for either whites or blacks. Further, the results suggest that welfare-induced migration among blacks leads to an upward bias in the estimated welfare effect in previous studies. |
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Bibliography Citation
Hoynes, Hilary Williamson. "Does Welfare Play Any Role in Female Headship Decisions?" Discussion Paper No. 1078-95, Institute for Research on Poverty, September 1995. |