Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/244730 
Year of Publication: 
2021
Series/Report no.: 
ECON WPS - Working Papers in Economic Theory and Policy No. 07/2021
Publisher: 
TU Wien, Institute of Statistics and Mathematical Methods in Economics, Research Unit in Economics, Vienna
Abstract: 
The Covid-19 pandemic has brought about changes in key income support programs, reigniting a debate about the design of financial aid to low-income households with children. In this study we assess the Family Security Act - a proposal presented by Senator Mitt Romney (R-UT) on February 4, 2021 to reform the tax/transfer system-in terms of its efficacy to achieve the stated objectives of increasing marriage rates and cutting child poverty at no cost to the government. The assessment is carried out through a structural microsimulation approach, using a dynamic model of savings, labor supply, household formation, and marital status. We find that while the plan would be highly effective at increasing marriage, it would reduce child poverty at the expense of increasing poverty among single-mother families and child deep poverty. Furthermore, the plan would entail a substantial cost to taxpayers.
Subjects: 
Income Support
household decisions
cohabitation and marriage
poverty
JEL: 
E21
H24
H31
J12
Document Type: 
Working Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.