The EITC, Tax Refunds, and Unemployment Spells
AbstractThe Earned Income Tax Credit generates large average tax refunds for low-income parents, and these refunds are distributed in a narrow time frame. I rely on this plausibly exogenous source of variation in liquidity to investigate the effect of cash-on-hand on unemployment duration. Among EITC-eligible women, unemployment spells beginning just after tax refund receipt last longer than unemployment spells beginning at other times of year. There is no evidence that tax refund receipt is associated with longer unemployment duration for men, or that the longer durations for women are associated with higher-quality subsequent job matches.
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Bibliographic InfoPaper provided by Department of Economics, Williams College in its series Department of Economics Working Papers with number 2011-08.
Length: 46 pages
Date of creation: Jul 2011
Date of revision:
Other versions of this item:
- H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion
- H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
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- NEP-CIS-2011-07-13 (Confederation of Independent States)
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- Sara LaLumia & James M. Sallee & Nicholas Turner, 2013.
"New Evidence on Taxes and the Timing of Birth,"
NBER Working Papers
19283, National Bureau of Economic Research, Inc.
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