The optimal design of low income support is examined using a structural labour supply model. The approach incorporates unobserved heterogeneity, fixed costs of work, childcare costs and the detailed non-convexities of the tax and transfer system. The analysis considers purely Pareto improving...

The optimal design of low income support is examined using a structural labour supply model. The approach incorporates unobserved heterogeneity, fixed costs of work, childcare costs and the detailed non-convexities of the tax and transfer system. The analysis considers purely Pareto improving...

Lone mothers are overrepresented among poor people in many European countries. In 1998, in Norway, a welfare reform increased the amount of benefits and introduced working requirements. Using a quasi-experimental model, Mogstad and Pronzato (2012) find a positive effect of the reform on lone...

In this paper, we investigate the response of female lone parents to two reforms to the welfare system in Australia. We look at changes to both hours and participation and focus on the channels of adjustment, in particular the role of job changes for adjustment in hours. We highlight the...

This paper reviews how income-support systems affect labour force participation in the UK. The UK's approach to social insurance is "basic security", with modest, typically flat-rate, benefits; insurance-based benefits are relatively unimportant. Compared with the EU, the UK has high employment...

This paper measures the 2007-13 evolution of employment tax rates in the U.K. and the U.S. The U.S. changes are greater, in the direction of taxing a greater fraction of the value created by employment, and primarily achieved with new implicit tax rates. Even though both countries implemented a...

With many countries considering the adoption of a system of earned income tax credits, it is useful to analyze how different types of credits affect labor supply and earnings. This paper focuses on a 1999 reform to the UK tax credit system, which increased the value of the credit and reduced the...

This paper uses British panel data to investigate single women's labour supply changes in response to three tax and benefit policy reforms that occurred in the 1990s. These reforms changed individuals' work incentives and we use them to identify changes in labour supply. We find evidence of...

We investigate the role of employment in explaining changes in the mental health of single mothers compared to partnered mothers and single childless women during the period of welfare reform in the UK. We employ a time allocation framework to explore if reductions in benefit income led to a...

In October 1999, the British government enacted the Working Families' Tax Credit, a generous tax credit aimed at encouraging work among low-income families with children. This paper uses longitudinal data collected between 1991 and 2001 to evaluate the effect of this reform on single mothers. We...