Welfare Benefits and Lone Parents' Employment in Great Britain
The analysis pools ten years of General Household Surveys to identify the effects of Britain's welfare benefit system on a lone mother's probability of employment. It confirms the prediction that, because of the implicit 100 percent tax rate in the system, higher nonlabor income (other than welfare benefits) increases the probability while a higher benefit guarantee reduces it. The analysis also confirms that among women who could never be eligible for benefits, higher nonlabor income reduces the probability of employment and the guarantee has no effect.
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