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 language | English (US) |
|---|---|
| Pages (from-to) | 5-29 |
| Number of pages | 25 |
| Journal | Journal of Public Economics |
| Volume | 89 |
| Issue number | 1 |
| DOIs | |
| State | Published - 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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Cite this
Michalopoulos, C., Robins, P. K., & Card, D. (2005). When financial work incentives pay for themselves: Evidence from a randomized social experiment for welfare recipients. Journal of Public Economics, 89(1), 5-29. https://doi.org/10.1016/j.jpubeco.2002.02.001