Robert McClelland

Effects of Child Tax Credit Design on Employment

 Recent expansions of the Child Tax Credit (CTC) have generated interest in how the credit affects parental labor supply and child poverty. However, there is limited empirical evidence of the labor supply effects of the CTC outside of the context of the COVID-19 pandemic. We address this knowledge gap using 1997-2019 data from the Panel Study of Income Dynamics (PSID) to provide updated estimates of how low and middle-income parents’ employment responds to changes in incentives for three groups of parents: unmarried mothers, married mothers, and married fathers.