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Taxes, Health Insurance and Women's Self-Employment

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  • Velamuri, Malathi

Abstract

I examine whether the availability of health coverage through the spouse's health plan influences a married woman's decision to become self-employed. The Tax Reform Act of 1986 (TRA86) introduced a tax subsidy for the self-employed to purchase their own health insurance. I test whether this `natural' experiment induced more women without spousal health insurance coverage to select into self-employment. The difference-in-difference estimates based on an analysis of employed women indicate that the incidence of self-employment among women who did not enjoy spousal health bene�ts rose signi�cantly - between 14% and 25% - in the post-TRA86 period, while a multinomial speci�cation based on a sample of both employed and non-employed women suggests that the increase was around 9%.

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File URL: http://mpra.ub.uni-muenchen.de/50474/
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File URL: http://mpra.ub.uni-muenchen.de/50519/
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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 50474.

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Date of creation: 2009
Date of revision: Apr 2012
Publication status: Published in Contemporary Economic Policy 2.30(2012): pp. 162-177
Handle: RePEc:pra:mprapa:50474

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Keywords: Health Insurance; Self-Employment;

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References

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  2. Robert W. Fairlie & Kanika Kapur & Susan Gates, 2009. "Is Employer-Based Health Insurance a Barrier to Entrepreneurship?," Working Papers 200939, Geary Institute, University College Dublin.
  3. Gumus, Gulcin & Regan, Tracy L., 2009. "Self-Employment and the Role of Health Insurance," IZA Discussion Papers 3952, Institute for the Study of Labor (IZA).
  4. Puhani P-A., 2010. "The Treatment Effect, the Cross Difference, and the Interaction Term in Nonlinear “Difference-in-Differences” Models," Working Papers ERMES 1004, ERMES, University Paris 2.
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  23. Alison J. Wellington, 2001. "Health Insurance Coverage And Entrepreneurship," Contemporary Economic Policy, Western Economic Association International, vol. 19(4), pages 465-478, October.
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Cited by:
  1. Robert W. Fairlie & Kanika Kapur & Susan Gates, 2009. "Is Employer-Based Health Insurance a Barrier to Entrepreneurship?," Working Papers 200939, Geary Institute, University College Dublin.
  2. Gulcin Gumus & Tracy Regan, 2007. "Self-Employment and the Role of Health Insurance," Working Papers 0910, University of Miami, Department of Economics.

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