Effects of the Expanded Child Tax Credit on Employment Outcomes: Evidence from Real-World Data from April to December 2021

Ananat, Elizabeth Oltmans; Glasner, Benjamin; Hamilton, Christal; Parolin, Zachary

doi:10.2139/ssrn.4051257

Cited by 10 publications

(22 citation statements)

References 15 publications

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“…Previous research has shown differences in CTC receipt by race/ethnicity (Pilkauskas and Cooney, 2021;Parolin et al, 2022), and historically, Black and Hispanic children have been less likely to be eligible for the full CTC (Goldin and Michelmore, 2022). Though our entire sample is economically disadvantaged, and therefore unlikely to have been eligible for the full CTC regardless of race, we still may expect to find differential impacts of the 2021 monthly credit by race and ethnic background.…”

Section: Are There Heterogeneous Treatment Effects By Race/ethnicity?mentioning

confidence: 71%

“…Other descriptive studies suggest that the CTC reduced food insufficiency (Perez-Lopez, 2021;Rapid EC, 2021;Karpman et al, 2022). These findings have been corroborated in studies using more causal methodological approaches (Hamilton et al, 2022;Parolin et al, 2022;Shafer et al, 2022). Hamilton and colleagues (2022) find that families were more likely to be able to pay for an emergency expense, but they find few effects on other hardships like paying utilities, bills, housing, needed medical treatments or debt.…”

Section: Prior Literaturementioning

confidence: 86%

“…Hamilton and colleagues (2022) find that families were more likely to be able to pay for an emergency expense, but they find few effects on other hardships like paying utilities, bills, housing, needed medical treatments or debt. Three studies also find that the monthly CTC cash payments had no effect on parental employment (Ananat et al, 2022;Hamilton et al, 2022;Lourie et al, 2021). We build on these earlier studies by studying the effects of the 2021 monthly cash payment on a broad array of hardship measures in a national sample of families with very low incomes, many of whom gained access to the CTC or received a larger credit as a result of the 2021 expansion.…”

Section: Prior Literaturementioning

confidence: 91%

“…In this study, we add to the literature on the causal effects of income on material hardship in the U.S. by studying the effects of a recurring unconditional cash transfer -the monthly 2021 Child Tax Credit (CTC). We also extend the nascent evidence base on the effects of the 2021 CTC (Parolin et al, 2021;Shafer et al, 2021;Ananat et al, 2022;Hamilton et al, 2022) by focusing on a national sample of families with very low incomes -those who are often under-represented in national samples -and by examining a wide range of material hardship measures and indicators of economic wellbeing.…”

mentioning

confidence: 95%

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The Effects of Income on the Economic Wellbeing of Families with Low Incomes: Evidence from the 2021 Expanded Child Tax Credit

Pilkauskas¹,

Michelmore²,

Kovski³

et al. 2022

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We examine the effects of an unconditional cash transfer on the economic wellbeing (material hardship, ability to meet needs, money on hand, use of friends and family for assistance, and employment) of families and children with very low incomes. We use a parameterized differencein-differences approach to study the impact of the 2021 temporary expansion of the Child Tax Credit (CTC), which provided monthly, unconditional cash payments to families with children from July to December 2021. The 2021 monthly CTC reduced the number of hardships families experienced, and in particular their food insecurity. We find some evidence that the credit reduced medical hardships, reduced reliance on friends and family for food, and improved respondents' ability to pay utility bills. We also find no effects on any labor supply measures. Analyses that examine differences by racial/ethnic groups show that the effects are somewhat stronger for Black families than for Hispanic and White families, but the differences are not large.

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Section: Are There Heterogeneous Treatment Effects By Race/ethnicity?mentioning

confidence: 71%

Section: Prior Literaturementioning

confidence: 86%

Section: Prior Literaturementioning

confidence: 91%

mentioning

confidence: 95%

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The Effects of Income on the Economic Wellbeing of Families with Low Incomes: Evidence from the 2021 Expanded Child Tax Credit

Pilkauskas¹,

Michelmore²,

Kovski³

et al. 2022

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“…While interesting and worthy of further empirical investigation, we ignore the negative effects on very high-income families and focus instead on the income levels at which benefits begin to decline and at which benefits reach 0.10 We use data in Figure1and Table4inLøken et al (2012) and convert Norwegian kroner into 2019 U.S. dollars. The effects of income increases appear, in Panels A, B, and C of Figure1, to drop to 0 by the time family income reaches approximately $100,000.11 There is recent research that suggests no effects of ARP CTC expansion on work(Ananat et al, 2021). However, since there has been no consensus yet over the impact of ARP CTC expansion on work, we decide to be conservative and assume that there is a reduction in work after the expansion.Journal of Benefit-Cost Analysis…”

mentioning

confidence: 99%

The Benefits and Costs of a Child Allowance

Garfinkel

Sariscsany

Ananat

et al. 2022

J. Benefit Cost Anal.

Self Cite

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This article conducts a benefit-cost analysis of a child allowance. Through a systematic literature review of the highest quality evidence on the causal effects of cash and near-cash transfers, this article produces core estimates on the benefits and costs per child and per adult of increasing household income by $1000, which can be used for any cash or near-cash program that increases household income. We then apply these estimates to three child allowance proposals, with the main proposal converting the $2000 Child Tax Credit in the federal income tax code into a fully refundable and more generous child allowance of $3600 per child ages 0–5 and $3000 per child ages 6–17, as enacted for 1 year in the American Rescue Plan. Aggregate costs and benefits are estimated via micro-simulation. Our estimates indicate that making the $2000 Child Tax Credit fully refundable and increasing benefits to $3000/$3600 would cost $97 billion per year and generate social benefits of $929 billion per year. Sensitivity analyses indicate that the results are robust to alternative assumptions and that each of the three child allowance proposals produces a very strong to an extraordinarily strong return for the U.S. population.

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Association of Expanded Child Tax Credit Payments With Child Abuse and Neglect Emergency Department Visits

Bullinger

Boy

2023

JAMA Netw Open

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ImportancePoverty has long been associated with a higher risk for child maltreatment, and recent research suggests that income support policies are associated with reduced child abuse and neglect. However, income supports tied to employment cannot separate the associations of income from those of employment.ObjectiveTo estimate the short-term association of universal and unconditional income payments to parents with child abuse and neglect.Design, Setting, and ParticipantsIn this cross-sectional study, variation in the timing of the 2021 expanded child tax credit (CTC) advance payments was used to determine whether receiving unconditional income is associated with child abuse and neglect. A fixed-effects approach was used to compare child abuse and neglect before and after payments were made in 2021. The study compared 2021 trends with the same period in 2018 and 2019, during which no CTC payments were made. Participants were pediatric emergency department (ED) patients identified as experiencing child abuse or neglect at a level I pediatric hospital system in the Southeastern US from July through December 2021. Data were analyzed from July to August 2022.ExposuresTiming in the disbursement of the expanded CTC advance payments.Main Outcomes and MeasuresDaily child abuse and neglect-related ED visits.ResultsDuring the study period, there were 3169 ED visits related to child abuse or neglect. The 2021 advance payments of the expanded CTC were associated with fewer child abuse and neglect-related ED visits. There was a decrease in these ED visits in the 4 days following the advance CTC payments, although the reduction was not significant (point estimate, −0.22; 95% CI, −0.45 to 0.01; P = .06). There were significant reductions in such ED visits among male children (point estimate, −0.40; 95% CI, −0.75 to −0.06; P = .02) and non-Hispanic White children (point estimate, −0.69; 95% CI, −1.22 to −0.17; P = .01). These reductions did not persist, however.Conclusions and RelevanceThese findings suggest that federal income supports to parents are associated with immediate reductions in child abuse and neglect-related ED visits. These results are important for discussions of making the temporary expansion of the CTC permanent and are applicable to income support policies more broadly.

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Effects of the Expanded Child Tax Credit on Employment Outcomes: Evidence from Real-World Data from April to December 2021

Cited by 10 publications

References 15 publications

The Effects of Income on the Economic Wellbeing of Families with Low Incomes: Evidence from the 2021 Expanded Child Tax Credit

The Effects of Income on the Economic Wellbeing of Families with Low Incomes: Evidence from the 2021 Expanded Child Tax Credit

The Benefits and Costs of a Child Allowance

Association of Expanded Child Tax Credit Payments With Child Abuse and Neglect Emergency Department Visits

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