Tax and transfer programs transform before-tax income into after-tax income. Income is variable and the tax and transfer system is nonlinear-i.e., marginal tax rates vary. We show that, as a consequence, the tax and transfer system punishes (and rewards) income variability. We calculate the...

We employ the model used by Fraker, Moffitt, and Wolf (1985) to estimate effective tax rates and guarantees in the Aid to Families with Dependent Children (AFDC) program for the years 1967-82 to produce comparable estimates for 1983-91. We compare this ...

The results of the Gary Negative Income Tax Experiment show significant work disincentives of 3 to 6 percent for husbands, 26 to 30 percent for female heads, but none for wives. The response of husbands is similar to those in other experiments. The response of female heads is somewhat larger...

We estimate the trend in the transitory variance of male earnings in the United States using the Michigan Panel Study of Income Dynamics from 1970 to 2004. Using an error components model and simpler but only approximate methods, we find that the transitory variance started to increase in the...

The results of the Gary Negative Income Tax Experiment show significant work disincentives of 3 to 6 percent for husbands, 26 to 30 percent for female heads, but none for wives. The response of husbands is similar to those in other experiments. The response of female heads is somewhat larger...

Only a few studies have tried to estimate the trend in the elasticity of children's economic status with respect to parents' economic status, and these studies produce conflicting results. In an attempt to reconcile these findings, we use the Panel Study ...

By 1989 the Michigan Panel Study on Income Dynamics (PSID) had experienced approximately 50 percent sample loss from cumulative attrition from its initial 1968 membership. We study the effect of this attrition on the unconditional distributions of several socioeconomic variables and on the...

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The existing literature on welfare effects on female headship in the United States shows significant positive correlations in cross-section, possibly increasing over time. However, when geographic, or area, effects are permitted in the estimation, these correlations either disappear or reverse...

Several econometric issues in the estimation of fertility equations with panel data are addressed in this paper. The most interesting is the truncation of the error term in a number-of-children equation arising from the fact that the number of children cannot fall over time. It is shown that...