Work Requirements and Income Maintenance Programs

Joel Shapiro

No 20, Working Papers from Barcelona School of Economics

Abstract: This paper examines the role of work as an incentive device in income maintenance programs in different informational environments. To that end, we make both the income generating ability and the disutility of labor of individuals unobservable, and compare the resulting benefit schedules with those of programs found in the United States since Welfare Reform (1996). We find that work requirements arise only in restricted environments due to the tradeoff between incentives and costs. Optimal programs closely resemble a Negative Income Tax with a Benefit Reduction Rate that depends on the distribution of population characteristics.

Keywords: Welfare programs; optimal taxation; multidimensional screening (search for similar items in EconPapers)
JEL-codes: D82 H21 H53 (search for similar items in EconPapers)
Date: 2015-09
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://bw.bse.eu/wp-content/uploads/2019/09/BSEstudentsClassof2020-file.jpg (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bge:wpaper:20

Access Statistics for this paper

More papers in Working Papers from Barcelona School of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Bruno Guallar ().