Female labour supply, human capital and welfare reform

Blundell, Richard and Costa Dias, Monica and Meghir, Costas and Shaw, Jonathan (2013) Female labour supply, human capital and welfare reform. Other. IFS.

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Official URL: http://www.ifs.org.uk/publications/6703

Abstract

We consider the impact of tax credits and income support programs on female education choice, employment, hours and human capital accumulation over the life-cycle. We analyze both the short run incentive effects and the longer run implications of such programs. By allowing for risk aversion and savings, we quantify the insurance value of alternative programs. We find important incentive effects on education choice and labor supply, with single mothers having the most elastic labor supply. Returns to labor market experience are found to be substantial but only for full-time employment, and especially for women with more than basic formal education. For those with lower education the welfare programs are shown to have substantial insurance value. Based on the model, marginal increases to tax credits are preferred to equally costly increases in income support and to tax cuts, except by those in the highest education group.

Item Type:Working Paper (Other)
Subjects:1. Frameworks for Research and Research Designs > 1.11 Evaluation Research
5. Quantitative Data Handling and Data Analysis > 5.17 Quantitative Approaches (other)
ID Code:3154
Deposited By: PEPA User
Deposited On:01 Jul 2013 16:42
Last Modified:01 Jul 2013 16:42

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