The labour supply effect of Education Maintenance Allowance and its implications for parental altruism

Angus Holford

No 2014-37, ISER Working Paper Series from Institute for Social and Economic Research

Abstract: Education Maintenance Allowance (EMA) was a UK government cash transfer paid directly to children aged 16-18 in post-compulsory full-time education. Using data from the Longitudinal Study of Young People in England, we find an EMA payment of £30 per week reduces teenagers’ labour supply by 3 hours per week. We show this is consistent with parents withdrawing cash and in-kind transfers from their child to a value between £7.80 and £20.10 per week. We therefore argue that making this cash transfer directly to the child produces higher child welfare than if the equivalent transfer were made to parents.

Date: 2014-10-17
New Economics Papers: this item is included in nep-eur and nep-lab
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Related works:
Journal Article: The labour supply effect of Education Maintenance Allowance and its implications for parental altruism (2015)
Working Paper: The Labour Supply Effect of Education Maintenance Allowance and its Implications for Parental Altruism (2015)
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