1. Short-term effects of the earned income tax credit on mental health and health behaviors
- Author
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Akansha Batra, Laura Shields-Zeeman, Leah Machen, Rita Hamad, David H. Rehkopf, Anusha M. Vable, and Daniel F. Collin
- Subjects
Difference-in-differences ,Epidemiology ,Health Behavior ,No Poverty ,Earned income tax credit ,01 natural sciences ,Article ,03 medical and health sciences ,Substance Misuse ,0302 clinical medicine ,Behavioral and Social Science ,National Health Interview Survey ,Medicine ,Humans ,030212 general & internal medicine ,0101 mathematics ,Health behaviors ,Poverty alleviation ,Receipt ,Poverty ,business.industry ,010102 general mathematics ,Smoking ,Income Tax ,Public Health, Environmental and Occupational Health ,Human Movement and Sports Sciences ,Mental health ,Mental Health ,Good Health and Well Being ,Panel Study of Income Dynamics ,Tax refund ,Income ,Public Health and Health Services ,Public Health ,Null hypothesis ,business ,Demography - Abstract
Poverty has consistently been linked to poor mental health and risky health behaviors, yet few studies evaluate the effectiveness of programs and policies to address these outcomes by targeting poverty itself. We test the hypothesis that the earned income tax credit (EITC)-the largest U.S. poverty alleviation program-improves short-term mental health and health behaviors in the months immediately after income receipt. We conducted parallel analyses in two large longitudinal national data sets: the National Health Interview Survey (NHIS, 1997-2016, N=379,603) and the Panel Study of Income Dynamics (PSID, 1985-2015, N=29,808). Outcomes included self-rated health, psychological distress, tobacco use, and alcohol consumption. We employed difference-in-differences analysis, a quasi-experimental technique. We exploited seasonal variation in disbursement of the EITC, which is distributed as a tax refund every spring: we compared outcomes among EITC-eligible individuals interviewed immediately after refund receipt (Feb-Apr) with those interviewed in other months more distant from refund receipt (May-Jan), "differencing out" seasonal trends among non-eligible individuals. For most outcomes, we were unable to rule out the null hypothesis that there was no short-term effect of the EITC. Findings were cross-validated in both data sets. The exception was an increase in smoking in PSID, although this finding was not robust to sensitivity analyses. While we found no short-term "check effect" of the EITC on mental health and health behaviors, others have found long-term effects on these outcomes. This may be because recipients anticipate EITC receipt and smooth their income accordingly.
- Published
- 2020