In-work benefits for married couples: an ex-ante evaluation of EITC and WTC policies in Italy

Luca, Giuseppe De; Rossetti, Claudio; Vuri, Daniela

doi:10.1186/2193-9004-3-23

Cited by 6 publications

(5 citation statements)

References 35 publications

(32 reference statements)

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“…Focusing exclusively on married women and single mothers in Italy, Figari (2015) finds that both individual-and family-based IWB schemes can increase female participation and that it is possible to achieve more redistribution and efficiency at the same time. In another Italian study, Luca et al (2014) show that the trade-off between efficiency and redistribution can be mitigated to some extent through a double-earner premium, with the remaining trade-off depending on the size of the premium. Ayala and Paniagua (2018) simulations suggest that IWBs would increase female participation in Spain as well.…”

Section: In-work Benefits As Make-work-pay Instrumentsmentioning

confidence: 92%

“…26. Some researchers have proposed a "premium" for double-earner families as a design feature aimed at dealing with the trade-off (Luca et al, 2014;Kurowska et al, 2017). and Liebman, 1996;Eissa and Hoynes, 2004;Eissa and Hoynes, 2006;Meyer and Rosenbaum, 2001;Chetty et al, 2013).…”

Section: In-work Benefits As Make-work-pay Instrumentsmentioning

confidence: 99%

“…The reasons are partly structural in nature, and the design of the tax-benefit system and the work (dis)incentives it embodies might be among them. The previous literature on some south and south-east European countries has shown that there is a potential for in-work benefits to improve incentives for employment (Figari, 2010;Figari, 2015;Luca et al, 2014;Ayala and Paniagua, 2018;Ranđelović et al, 2013;Mojsoska Blazevski et al, 2015), and we assess this potential in Croatia. Focusing on couples, we find that while both benefits redistribute towards low-income households, only the one that is income-tested at the individual level increases the probability of participation.…”

Section: Introductionmentioning

confidence: 99%

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Making work pay in Croatia: An exante evaluation of two in-work benefits using miCROmod

Bezeredi¹,

Ledić²,

Rubil³

et al. 2018

IJM

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The aim of this paper is twofold. First, we introduce miCROmod, the most recent and comprehensive tax-benefit microsimulation model for Croatia. The focus of this paper is on its behavioural component, a structural labour supply model. Unlike in the standard discrete choice models, where labour supply follows from the agent's choice of work/leisure hours only, in our model, labour supply follows from the agent's choice from a set of jobs, which are characterised by work hours and a set of non-pecuniary job attributes that are unobserved by the researcher. In addition to the budget constraint, the agent faces constraints in the form of labour market opportunities. Second, we use the behavioural tax-benefit model to simulate the effects on the labour supply of couples and the income distribution of the introduction of in-work benefits-transfers conditional on working a certain number of hours. The following two benefits are considered: a family-based benefit imported from the UK, which is income-tested at the family level, and an individual-based benefit from Slovakia, which is income-tested at the individual level. According to the results, both are redistributive towards the needy. However, while the individual-based benefit increases the labour supply, the family-based benefit reduces it, contrary to its very purpose. An implication is that countries considering introducing an in-work benefit and that have most of their social transfers income-tested at the family level should be aware that family-level income-testing of in-work benefits might not improve work incentives, or might even harm them, especially if the benefits are generous.

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Section: In-work Benefits As Make-work-pay Instrumentsmentioning

confidence: 92%

Section: In-work Benefits As Make-work-pay Instrumentsmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Making work pay in Croatia: An exante evaluation of two in-work benefits using miCROmod

Bezeredi¹,

Ledić²,

Rubil³

et al. 2018

IJM

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show abstract

“…Descriptive statistics of the estimation sample are provided in the Appendix (Table A1). Since the model mostly deals with wage employment, similar to the literature on Southern European countries, it is focused on formal work, with the similar or slightly higher wage-employment informality (De Luca et al, 2013, Figari, 2015. Discrete choice labour supply models are based on the assumption that a household can choose among a finite number of J+1 working hours.…”

Section: Methodology: Behavioural Microsimulation Model Data and Polmentioning

confidence: 99%

Labour Supply and Inequality Effects of In-Work Benefits: Evidence from Serbia

Ranđelović

Rakić

Vladisavljević

et al. 2019

Naše Gospodarstvo/Our Economy

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Low labour market participation, together with the high effective tax wedge at low wage levels, create a fertile ground for the introduction of the in-work benefits (IWB) in Serbia. Our paper provides an ex-ante evaluation of the two IWB schemes, directed at stimulating the labour supply and more equal income distribution. The methodological approach combines the tax-and-benefit microsimulation model with the discrete labour supply model. Our results show that both individual and family-based IWB schemes would considerably boost labour market participation, although family-based benefits would have disincentivizing effects for the secondary earners in couples. Most of the behavioural changes take place among the poorest individuals, with significant redistributive effects.

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“…In‐work benefits are effective tools for alleviating the poverty of families with children, since many empirical studies suggest that the labour supply effects of these benefits are concentrated on the low‐earning families with children (CBPP, ; De Luca, Rossetti, & Vuri, ; Nichols & Rothstein, ). The labour supply mechanism, included in the in‐work benefit programmes, may play an important role in the efficacy of other means‐tested programmes in tackling child poverty, since more generous means‐tested benefits may discourage working.…”

Section: Literature Reviewmentioning

confidence: 99%

Reduction of child poverty in Serbia: Benefit or employment strategy?

Clavet¹,

Tiberti

Vladisavljević

et al. 2018

Econ of Transit and Inst Chang

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Based on the Serbian Survey of Income and Living Conditions (SILC) and tax benefits and structural microsimulation models, we evaluate the labour supply and distributive effects of several reform strategies concerning two major social transfers in Serbia: child allowance and social monetary assistance. Our results show that, in a context of a low labour participation rate, and high unemployment and informality rates, a benefit strategy is by far the more cost‐effective option for reducing child poverty than an employment strategy that aims to raise the work incentives for parents. Both proposed reforms are found to be progressive.

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In-work benefits for married couples: an ex-ante evaluation of EITC and WTC policies in Italy

Cited by 6 publications

References 35 publications

Making work pay in Croatia: An exante evaluation of two in-work benefits using miCROmod

Making work pay in Croatia: An exante evaluation of two in-work benefits using miCROmod

Labour Supply and Inequality Effects of In-Work Benefits: Evidence from Serbia

Reduction of child poverty in Serbia: Benefit or employment strategy?

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