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Female labour supply, human capital and welfare reform

Blundell, Richard, Meghir, Costas, Shaw, Jonathan and Costa Dias, Monica (2013) Female labour supply, human capital and welfare reform. Public Economics Programme Papers (PEP 21). Suntory and Toyota International Centres for Economics and Related Disciplines, London, UK.

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We consider the impact of tax credits and income support programs on female education choice, employment,hours and human capital accumulation over the life-cycle. We analyze both the short run incentive effects and the longer run implications of such programs. By allowing for risk aversion and savings,we quantify the insurance value of alternative programs. We find important incentive effects on education choice and labor supply, with single mothers having the most elastic labor supply. Returns to labor market experience are found to be substantial but only for full-time employment, and especially for women with more than basic formal education. For those with lower education the welfare programs are shown to have substantial insurance value. Based on the model, marginal increases to tax credits are preferred to equally costly increases in income support and to tax cuts, except by those in the highest education group.

Item Type: Monograph (Report)
Official URL:
Additional Information: © 2013 The Authors
Divisions: STICERD
Subjects: H Social Sciences > HB Economic Theory
Date Deposited: 22 Jul 2014 09:03
Last Modified: 20 Oct 2021 23:20
Projects: RES-000-23-1524, RES-051-27-0204
Funders: Economic and Social Research Council, Cowles foundation

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