The earned income tax credit, mental health, and happiness

Abstract

This paper contributes to the small but growing literature evaluating the health effects of the Earned Income Tax Credit (EITC). In particular, we use data from the National Survey of Families and Households to study the impact of the 1990 federal EITC expansion on several outcomes related to mental health and subjective well-being. The identification strategy relies on a difference-indifferences framework to estimate intent-to-treat effects for the post-reform period. Our results suggest that the 1990 EITC reform generated sizeable health benefits for low-skilled mothers. Such women experienced lower depression symptomatology, an increase in self-reported happiness, and improved self-efficacy relative to their childless counterparts. Consistent with previous work, we find that married mothers captured most of the health benefits, with unmarried mothers' health changing very little following the 1990 EITC reform.

The Effects of Income on Health: New Evidence from the Earned Income Tax Credit

“…Strully et al (2010) and Markowitz et al (2017) additionally show that state-level EITCs can improve birth outcomes. Four studies that have focused on outcomes related to health have shown that the EITC increases employer-sponsored health insurance coverage (Baughman 2005), reduces smoking of mothers (Averett and Wang 2013), and improves both child development (Hamad and Rehkopf 2016) and subjective well-being of mothers (Boyd-Swan et al 2016).…”

Effects of state-level Earned Income Tax Credit laws in the U.S. on maternal health behaviors and infant health outcomes

“…In this paper, we contribute to the knowledge base about the effects of U.S. based EITC programs by focusing on the effects of states’ EITC on infant health outcomes and maternal health behaviors. A number of studies have examined the health effects of the federal EITC while ignoring state EITCs (Averett & Wang, 2013; Baker, 2008; Boyd-Swan et al, 2016; Evans & Garthwaite, 2014; Hamad & Rehkopf, 2015; Hoynes et al, 2015). These studies consistently find improvements in various measures of maternal and child health associated with the federal EITC.…”

The effects of state‐level earned income tax credits on suicides

“…Other work on the EITC has shown that the program reduces depression and increases happiness and self-esteem (Boyd-Swan, Herbst, Ifcher, & Zarghamee, 2016), and improves physical and mental health outcomes (Averett & Wang, 2013;Boyd-Swan et al, 2016;Evans & Garthwaite, 2014;Lenhart, 2019), birth outcomes (Hoynes, Miller, & Simon, 2015;Hamad & Rehkopf, 2016;Markowitz, Komro, Livingston, Lenhart, & Wagenaar, 2017), and health insurance coverage (Baughman, 2005;Baughman & Duchovny, 2016;Hoynes et al, 2015;Lenhart, 2019). It appears likely that expansions of the program affects the levels of financial security and stress for low-income families and that a combination of these factors can explain a potential association between EITC benefits and suicides.…”