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The long‐term effect of the Earned Income Tax Credit on women's physical and mental health

Lauren E. Jones, Guangyi Wang and Tansel Yilmazer

Health Economics, 2022, vol. 31, issue 6, 1067-1102

Abstract: Using a novel method, and data from the National Longitudinal Survey of Youth 1979 (NLSY79), we estimate the cumulative, long‐term, causal effect of Earned Income Tax Credit (EITC) eligibility on women's physical and mental health at age 50. We find that an increase in lifetime eligible EITC benefits is associated with long‐term improvements in physical health, such as reduced occurrence of activity‐limiting health problems and reduced reported diagnoses of mild and severe diseases. We explore intermediate health behaviors and outcomes, and find that an increase in lifetime eligible EITC benefits increases the number of hours worked and access to employer‐sponsored health insurance, and decreases body mass index in the short‐term. We find no significant effects of the EITC on mental health at age 50. Finally, we find that White women benefit disproportionately from the EITC in terms of mobility‐related health issues, while Black and Hispanic women benefit in terms of lung‐related illnesses like asthma, as well as cancer and stroke.

Date: 2022
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