Labor Supply Effects of a Universal Cash Transfer

Jan Gromadzki

No 16186, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: I investigate the labor supply effects of the introduction of a large unconditional cash benefit. I exploit the unique design of the child benefit program in Poland to identify the income effects of the monthly transfer in a difference-in-differences design. On average, the marginal propensity to earn out of unearned income was equal to -0.14. For every extra 100 dollars in monthly child benefit transfers households receive, they spend 43 dollars on consumption and save 43 dollars. Additional evidence shows that the program had a positive impact on investments in human capital and home production efficiency.

Keywords: poverty; child benefit; labor supply; income effects; unconditional cash transfer; difference-in-differences (search for similar items in EconPapers)
JEL-codes: I38 J21 J22 (search for similar items in EconPapers)
Pages: 46 pages
Date: 2023-05
New Economics Papers: this item is included in nep-eur, nep-lma and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Published - published in: Journal of Public Economics, 2024, 239, 105248

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Journal Article: Labor supply effects of a universal cash transfer (2024)
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