Essays in public policies

This dissertation consists of three essays examining public policies. In the first chapter, I examine labor supply responses to EITC changes in a model with labor supply restrictions. I investigate labor supply effects of the EITC with a structural model, augmented with two factors that limit workers' hours choices: costs of working and different wage offers between full-time and part-time work. I estimate a discrete choice static model with restrictions on hours choices using indirect inference. Through simulations I find that single mothers increase hours worked in response to positive substitution effects of the EITC in the subsidy region, but show little responsiveness to negative effects of the EITC beyond the subsidy region. Without wage differentials between full-time and part-time work, I find that single mothers become more responsive to negative incentives of the EITC on hours worked in the phase-out region. These findings suggest that with higher wage offers in full-time work than in part-time work, workers are likely to retain full-time work, which leads to little responsiveness to negative incentives of the EITC on hours worked. In the second chapter, I examine the impact of TANF policy changes on TANF use and the cross-program effect of TANF policies on the SNAP caseload for single-parent households. I find that increased implementation of life-time time limits and strict sanctions to the TANF program leads to a decrease in TANF cases but an increase in SNAP cases. The results suggest that TANF policy changes with emphasis on work can move welfare recipients away from cash assistance, but toward SNAP participation. The third chapter, which is joint work with Lonnie Berger, J. Michael Collins, and Timothy Smeeding, investigates how income support programs affect mortgage outcomes. Using the 2004 and 2008 panels of the Survey of Income and Program Participation, we test the effects of state level changes in the earned income tax credit and unemployment insurance showing these policies reduce exits from homeownership, as well as lower rates of evictions for renters and foreclosures for owners.