Jul. 07 2020

Earned Income Tax Credit Expansion Improves Women’s Health

The first experimental evaluation of an expansion of the Earned Income Tax Credit produces improvements in women’s earnings, income, and health

An article published today in the journal Health Affairs presents the first experimental evidence of the health effects of an expansion of one of the largest anti-poverty policies in the United States to low-income individuals without dependent children.

Researchers from Columbia Mailman School of Public Health, London School of Hygiene and Tropical Medicine, and Harvard aimed to test the effect of a four-fold increase in the amount of earned income tax credit (EITC) available to low-income Americans without dependent children.

The researchers found that, 32 months into the program, a sizeable expansion of EITC benefits for adults without dependent children was associated with a modest increase in income (+6%), and employment (+1.9%). These effects were larger among women and more disadvantaged men. Positive effects on health-related quality of life emerged for women, reducing inequalities in health-related quality of life by gender.

These findings add to the very limited experimental literature exploring the effects of anti-poverty programs on health in the United States. The article provides much-needed evidence on a policy lever available to policy-makers to reduce the strong association between poverty and poor health, using a credible causal design.

The expansion has bipartisan support, and the potential to be enacted. Peter Muennig, MD, professor of health policy and management at Columbia Mailman School and senior author of the study said: “This study is exciting because we have known for a long time that poverty is linked to premature aging, but we have never proven that we can intervene on this process with an intervention.”

Emilie Courtin, assistant professor at the London School of Hygiene and Tropical Medicine and lead author of the study said: “The EITC has emerged as a tool to decouple income and health and reduce socioeconomic inequalities in health. Our results show that expanding this program to workers without dependent children—who have been left out from previous expansions—can have positive income, employment, and ultimately health effects.”

Crucially, the current novel coronavirus 2019 crisis has magnified existing income and health inequalities. “An expanded EITC for workers without dependent children is part of the proposed relief bill and out study provides key evidence on its positive effects on income, employment, and beyond on health,” said Cynthia Miller of MDRC, the study’s principal investigator.