Replication data for: Using Differences in Knowledge across Neighborhoods to Uncover the Impacts of the EITC on Earnings

Principal Investigator(s): View help for Principal Investigator(s) Raj Chetty; John N. Friedman; Emmanuel Saez

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eitc_AER-2012-0878			10/11/2019 07:17:PM
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Project Citation:

Chetty, Raj, Friedman, John N., and Saez, Emmanuel. Replication data for: Using Differences in Knowledge across Neighborhoods to Uncover the Impacts of the EITC on Earnings. Nashville, TN: American Economic Association [publisher], 2013. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-11. https://doi.org/10.3886/E112681V1

Project Description

Summary: We estimate the impacts of the Earned Income Tax Credit on labor supply using local variation in knowledge about the EITC schedule. We proxy for EITC knowledge in a Zip code with the fraction of individuals who manipulate reported self-employment income to maximize their EITC refund. This measure varies significantly across areas. We exploit changes in EITC eligibility at the birth of a child to estimate labor supply effects. Individuals in high-knowledge areas change wage earnings sharply to obtain larger EITC refunds relative to those in low-knowledge areas. These responses come primarily from intensive-margin earnings increases in the phase-in region.

Scope of Project

JEL Classification:
      H23 Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies
      H24 Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes
      H31 Fiscal Policies and Behavior of Economic Agents: Household
      J22 Time Allocation and Labor Supply
      J23 Labor Demand
      J31 Wage Level and Structure; Wage Differentials

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Published Versions

V1 [2019-10-11]

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