My dissertation consists of three essays on labor supply responses, along the extensive margin (participation into the labor force) and along the intensive margin (intensity of work on the job). The first two essays focus on the labor supply responsiveness of single women with children to taxation and welfare programs. The third essay investigates the effects of marriage, the wage rate, and the associated tax rate on men's labor supply.
In the first essay, to avoid bias from the fact that labor supply outcomes are being driven by self-selection, I build a dynamic stochastic discrete choice model to investigate the long run effects of the earned income tax credit and welfare policies on single mothers' labor supply. Simulated method of moments is used to estimate parameters of this dynamic model, based on March CPS data files from 1964 to 2013. I compare the performance of the dynamic stochastic discrete choice model, a static model, and a reduced-form model. My analysis concludes that the dynamic stochastic discrete choice model captures the simultaneous impact of the state variables on the predicted employment decision. My study provides evidence of the long-run positive effect of public policy on low income families in a life-cycle setting. This essay also emphasizes the importance of education in increasing single mothers' labor supply.
The second essay is designed to identify factors that help single mothers leave TANF within a short span of time. I find strong evidence for the importance of child support assistance to single mothers' success in exiting TANF with a job. I uncover evidence that work-related activities do not induce TANF participants to leave within a short span of time. My analysis also suggests that health issues significantly limit the ability of single mothers to exit TANF.
In the third essay, the main research question is how marital status affects the elasticity of the labor supply of males with respect to wages and taxes, in a life-cycle setting. A dynamic panel data model, which extends the literature on dynamic labor supply, indicates that the elasticity of men's labor supply with respect to wages and taxes is affected by marital status. The empirical results using the Panel Study of Income Dynamics (PSID) data show that men who are continuously married to the same wife have a lower average Frisch elasticity than others. / Ph. D.
| Identifer | oai:union.ndltd.org:VTETD/oai:vtechworks.lib.vt.edu:10919/76670 |
| Date | 28 September 2015 |
| Creators | Zhang, Yonghui |
| Contributors | Economics, Science, Tideman, Nicolaus, Plassman, Florenz, Cothren, Richard D., Ge, Suqin, Tsang, Kwok Ping |
| Publisher | Virginia Tech |
| Source Sets | Virginia Tech Theses and Dissertation |
| Detected Language | English |
| Type | Dissertation |
| Format | ETD, application/pdf |
| Rights | In Copyright, http://rightsstatements.org/vocab/InC/1.0/ |
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