When financial work incentives pay for themselves: Evidence from a randomized social experiment for welfare recipients

Charles Michalopoulos, Philip K. Robins, David Card

Research output: Contribution to journalArticle

22 Scopus citations

Abstract

This paper summarizes early findings from a social experiment that provided financial incentives for new welfare recipients to leave welfare and work full time. The financial incentive was essentially a negative income tax with a requirement that people work at least 30 h/week. Early results show that the financial incentive increased full-time employment, earnings, and income, and reduced poverty. Furthermore, at the end of the period discussed in this paper, the program was paying for itself through increased tax revenues.

Original languageEnglish (US)
Pages (from-to)5-29
Number of pages25
JournalJournal of Public Economics
Volume89
Issue number1
DOIs
StatePublished - Jan 1 2005

Keywords

  • Financial incentives
  • Labor supply
  • Social experimentation
  • Welfare reform
  • Welfare-to-work programs

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics

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