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Unformatted text preview: • Use labor/leisure tradeoff (Moffitt) SEE FIGURES A-E IN BINDER Welfare Reform • By early 1990s, welfare programs under attack from many people • Disincentives to work very strong (though EITC, Medicaid changes already starting to work) • Also clear that propensity to choose welfare was being passed from one generation to another—intergenerational transmissions • Led to sharp change in mid-1990s; having a child became an insufficient reason for continuous welfare Question • Has this been a success, or are lots of people worse off than before? • In bottom 20% of income, families with children have seen strong income gains • Mostly because of earnings/EITC...
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- Spring '08
- 1990, EITC