Search

Low-income households struggle to accumulate emergency savings, which increases economic vulnerability in the face of unexpected events like expensive car repairs. This vulnerability may be even greater among persistently low-income households, which might benefit most from building emergency savings using tax refunds. This study examined the effects of randomly assigned behavioral interventions that incorporated a choice architecture manipulation and savings-related messages aimed at encouraging refund saving and delivered through a free, online tax-filing software program. The study sample comprised 4,536 tax filers, including 1,235 with persistent low incomes. Using administrative tax data and data from a two-wave household financial survey, regression-adjusted treatment impacts were estimated using intent-to-treat analysis to examine whether filers had any of their tax refunds still in savings and how much of their refund they still had saved six months after filing their taxes. Results indicated directional but nonstatistically significant increases in these savings outcomes across three treatment groups for the full sample, yet statistically significant treatment effects among the persistently low-income subsample, effects that were moderated by the prefiling absence of emergency resources. These results suggested that tax-time savings interventions are most effective among low-income households with the greatest needs for emergency savings.

Stable and adequate housing is critical in the midst of a pandemic; without housing, individuals and families cannot shelter in place to prevent the spread of disease. Understanding and combating housing hardships in vulnerable populations is therefore essential to a sound public health response. This study aims to explore the pandemic’s disproportionate impacts on housing-related hardships across racial/ethnic groups in the United States as well as the extent to which these disparities are mediated by households’ broader economic circumstances; namely, their pre-pandemic liquid asset levels and the experience of COVID-19-related job and income losses. Using a national survey of over 4,000 households, we find that Black and Hispanic respondents were more vulnerable to housing-related hardships during the pandemic than White respondents. These impacts were particularly pronounced in lower-income minority households. For Black respondents, who had much lower levels of pre-pandemic liquid assets than other groups, liquid assets acted as a strong mediator of housing hardship disparities between White and Black respondents. On the other hand, neither liquid asset amounts before the pandemic nor employment shocks during the pandemic explain the pandemic’s disproportionate impacts on Hispanic families. Our findings imply that housing became less stable for racial/ethnic minority groups as a result of the pandemic. In particular, the observed disparities, as well as the mechanisms driving them, demonstrate the necessity of policies and practices that target support to these economically marginalized groups.

Many people in the United States have achieved economic stability through self-employment and are often seen as embracing the entrepreneurial spirit and seizing opportunity. Yet, research also suggests that self-employment may be precarious for many people in the lower socioeconomic strata. Drawing on a unique dataset that combines longitudinal survey data with administrative tax data for a sample of low- and moderate-income (LMI) workers, we bring new evidence to bear on this debate by examining the link between self-employment and economic insecurity. Overall, our results show that self-employment is associated with greater economic insecurity among LMI workers compared with wage-and-salary employment. For instance, compared with their wage-and-salary counterparts, the self-employed have 78, 168, and 287 percent greater odds of having an income below basic expenses, and experiencing an unexpected income decline and high levels of income volatility, respectively. We also find that differences in financial endowment and access to health insurance are key drivers in explaining the relationship between employment type and economic insecurity, as being able to access $2,000 in an emergency greatly lowers the odds of budgetary constraint, whereas lack of health insurance increases those odds. These findings suggest that formal work arrangements with wages and benefits offered by an employer promotes greater economic stability among LMI workers compared with informal work arrangements via self-employment. We discuss implications of these results for future research and policy initiatives seeking to promote economic wellbeing through entrepreneurship.

PurposeIn this paper, the authors explore the relationship that slack resources and technology-mediated human capital investments can have on individuals’ entrepreneurial intentions. Focusing on human capital investments that individuals make through education and work, the authors analyze the relationship among formal online learning opportunities, informal skill development in the gig economy and entrepreneurial intentions.Design/methodology/approachLeveraging a novel dataset that merges administrative tax data with a survey of over 8,528 low- and moderate income (LMI) households, this study uses machine learning and propensity score weighting to examine the likelihood that individuals who make these technology-mediated human capital investments will have increased odds of entrepreneurial intentions when compared to similar individuals who do not make these investments.FindingsThe authors find that both partaking in online learning and working in the gig economy are significantly associated with increased odds of entrepreneurial intentions. Furthermore, through a variety of robustness and mechanism checks, the authors find that technology-mediation is an important factor in these relationships and that informal skill development and career preparation is one way in which gig employment influences entrepreneurial intentions.Research limitations/implicationsAs the study’s data come from a cross-sectional survey, the authors cannot make causal inferences about the relationship between online learning, gig employment and entrepreneurial intentions. Thus, future research should explore sources of longitudinal data.Practical implicationsThis study has practical implication for individuals and policymakers that seek to increase entrepreneurship among LMI households.Originality/valueDespite a wealth of research on the relationships among slack resources, technology and innovation at the firm level, there is little of this research at the individual level – especially among LMI individuals. The authors begin to fill this important gap.

In early 2021, Congress expanded the existing Child Tax Credit (CTC), increasing the credit’s maximum value (up to $3,000 for school-age children and $3,600 for children under the age of six). Half of the credit was issued monthly to most families from July to December 2021. The temporary expansion was further made fully refundable, meaning that for one year, even very low-income families qualified. In this study, we draw on a novel, multi-wave probability-based panel survey of more than 1,000 CTC recipients to understand the credit’s impact on families. Using a mixed-methods approach that combines logistic regression and qualitative content analysis, we find that most respondents reported that the CTC made it easier for them to support their families, afford utility bills, and cover housing costs. Over one-third of respondents also stated that the CTC allowed them to pay for extracurricular activities for their children and save for their child’s future education, and spend more time with their children. In open-ended responses, parents describe that the CTC had a generally positive effect: it helped with bills/utilities, allowed families to save, helped with groceries/food, covered necessities for children, and reduced stress for parents. Conversely, some reported that it had no effects or made no difference. We also assess how participant demographics and political affiliation are associated with each theme.

The burden of the COVID-19 pandemic has not been shouldered equally by American families. Black and Hispanic communities have been hit the hardest, with the pandemic often exacerbating existing disparities. Using nationally representative data, we assess the economic and public health effects of the pandemic among different socioeconomic groups and whether typical sources of protection from economic insecurity are uniformly protective across the U.S. population. Within these sociodemographic groups, we also explore differences by education and industry. We find higher levels of employment loss among Blacks and Hispanics, those without college degrees, and frontline workers. We also find evidence that individuals and families are facing mental health episodes and are turning to costly alternative financial strategies to cope throughout the pandemic.

Despite the array of public programs offered to help households mitigate the economic impacts of the COVID-19 pandemic, many still needed to rely on savings, credit, or other assets to make ends meet. This reality may exacerbate existing social and economic inequities because racial and ethnic minorities often have lower access to assets and credit than white households. We use longitudinal national survey data to explore the extent to which different racial and ethnic groups experienced housing hardships during the pandemic, the role of liquid assets in mediating housing hardship, and whether job/income loss moderated the relationship among race/ethnicity, liquid assets, and housing hardship. We find that liquid assets significantly mediated the relationship between race/ethnicity and housing hardships and that the effect was stronger for those who lost jobs or incomes as a result of COVID-19.

Many U.S. households — especially those with low- to moderate-incomes (LMI) — struggle to save for retirement. To address this issue, the Department of the Treasury launched myRA, a no-fee retirement account designed primarily to help people who lacked access to employer-sponsored plans build retirement savings. In this paper, we report findings from two myRA-focused field experiments, both of which were administered to well over 100,000 LMI online tax filers before and during the 2016 tax season. The first experiment involved sending one of three different myRA-focused email messages to tax filers immediately prior to tax season, and the second experiment involved incorporating myRA-focused messages and choice architecture directly into an online tax filing platform. Messages were chosen to address different barriers to retirement savings LMI households may face. We find that, though the general level of interest in myRA was very low in this population, interest and enrollment in myRA depends heavily on the way in which the benefits of the accounts are framed. Results from both experiments indicate that messages emphasizing the possibility of receiving a larger refund in the future were the most effective at increasing interest in myRA, while messages focused around the simplicity and ease of use of the accounts were less effective. We also conduct several sub-sample analyses to investigate the extent to which these effects differed by key household characteristics.

Households in the U.S. regularly experience unexpected negative income or expense shocks, and low- and moderate-income households experience these shocks at disproportionately high rates. Relatively little is known about the impact these shocks have on households' subjective sense of financial well-being, and how access to different types of liquidity (e.g., liquid assets, credit cards, social resources, and income flows) can mitigate the impact of these shocks on subjective financial well-being. To address these gaps in the literature, this paper uses data from a two-wave survey administered to 3,911 low- and moderate-income tax filers in 2018. Applying a difference-in-difference analysis, we find that the experience of an income shock between survey waves was associated with a large decline in subjective financial well-being, while the experience of an expense shock was associated with a more modest decline. Relatively liquidity-constrained households tended to be more negatively impacted by shocks than their counterparts, though not all sources of liquidity were equally as effective in buffering households against shocks. The findings of this paper point to the need for policymakers and program administrators to develop tools that can facilitate access to different types of liquidity to offset different financial risks for households.

The Advance Premium Tax Credit (APTC) is designed to remedy lack of health insurance due to cost; however, approximately 30 million Americans remain without health insurance and millions of households leave billions in tax credits unclaimed each year. A prerequisite of APTC is to file one's taxes; however, few studies have examined tax filing and APTC jointly. This study examined the relationship between tax filing and applying for APTC, as well as perceived barriers to and sociodemographic characteristics associated with applying for the APTC.Descriptive study.Researchers surveyed 372 Marketplace-insured members who were eligible for APTC.Most of the sample filed personal taxes in 2019 and planned to file taxes in 2020, yet only 23% applied for the APTC in 2019, and 26.3% were planning to apply in 2020. Most commonly, respondents were not going to apply because they believed they were not eligible (53.5%), they did not know about the APTC (15.8%), and they did not know whether they were eligible (9.9%). Logistic regression modeling found that employment, income, and race were significantly associated with applying for the APTC.Barriers to applying for the APTC were unrelated to tax filing and were specific to a lack of knowledge about the APTC and eligibility. These results indicate the need to build knowledge and awareness of the APTC and eligibility and to target groups least likely to apply. Implications and future directions are discussed.

Lower income households are at risk for material hardship, particularly amidst the economic fallout of COVID-19. Where one lives (e.g., suburb, small town) may affect this risk due to variable acce...

Much of the literature on household finance tends to focus on relatively objective measures of financial security (e.g., savings, income, financial knowledge), and there has been less research on measures of subjective financial well-being. This gap is due in part to the absence of a common understanding on defining and measuring subjective financial well-being. The Consumer Financial Protection Bureau has recently developed a new Financial Well-Being Scale that provides a comprehensive way to measure this construct. The research on this scale is still scarce and little is known about how subjective financial well-being evolves over time. This paper uses a two-wave survey of low- and moderate-income tax filers to present among the first longitudinal analyses of this scale. Through descriptive analysis and lagged dependent variable regressions, we assess (1) the stability of financial well-being over a six-month period; (2) the extent to which relatively stable household characteristics predict volatility in subjective financial well-being; and (3) the relationship between adverse financial events, including financial shocks and material hardships, and subjective financial well-being. We find that financial well-being scores are extremely stable over the short-term, and that relatively stable household characteristics are not strong predictors of subjective financial well-being changes. We also find that, while adverse financial events like job loss are significantly associated with lower subjective financial well-being scores, the magnitude of these relationships is not large. These results have implications for the use of the financial well-being scale in evaluations of financial security interventions.

Background. Previous research has explored the impact of W.I.C. on recipients’ health, but less is known about the connection between barriers to W.I.C. access and health outcomes. We fill in a gap in the literature by studying the relationship between barriers to Special Supplemental Nutrition Program for Women, Infants, and Children (W.I.C.) access and adult and child food insecurity. Methods. After survey administration, we analyzed a cross-sectional sample of 2244 residents in Missouri who have used W.I.C. or lived in a household with a W.I.C. recipient in the past three years. We ran logistic regression models to understand the relationships among barriers to W.I.C. utilization, adult food insecurity, and child food insecurity. Results. Having special dietary needs (for adults), lacking access to technology, encountering inconvenient clinic hours of operation, and experiencing difficulties taking off work were associated with increased adult food insecurity. Difficulties finding WIC-approved items in the store, technological barriers, inconvenient clinic hours, difficulties taking off work, and finding childcare were associated with increased child food insecurity. Conclusion. Barriers to accessing and utilizing W.I.C. are associated with adult and child food insecurity. However, current policies suggest promising approaches to curbing these barriers.

For many low- and moderate-income (LMI) households in the U.S., the receipt of the tax refund marks one of the few times during the year when they can build savings. We present findings from a large-scale field experiment designed to encourage LMI tax filers to save their tax refund. The experiment tested combinations of behavioral strategies to promote savings including (1) asking filers at the start of tax preparation to pre-commit to saving their refund, and (2) choice architecture manipulations that emphasized directly depositing their refund into savings accounts or savings bond purchases. The four intervention conditions had a positive impact on the rate of refund deposits into savings accounts, increasing the deposit rate between 42% and 64%. However, the intervention conditions had minimal effects on the rate of bond purchases. The primary driver of increased savings deposits was the manipulation of the choice architecture. By comparison, savings pre-commitments had a more modest effect on savings deposits, on average. The impact of a pre-commitment on savings deposits varies over the course of the tax season, however, with early tax filers being much more responsive to pre-commitment than were later tax filers.

Israel’s Child Development Account (CDA) program, the Savings for Every Child Program (SECP), is universal and automatically enrolls all children under the age of 18, depositing 51 shekels (approximately USD 14) into their accounts every month. Parents can double this savings amount and can choose an investment vehicle for their children’s deposits. The total realized benefits from the SECP depend heavily on parents’ choices. This study examines how demographic, financial, and intrinsic personality characteristics predict household participation in this program. Using a unique data set combining administrative and survey data, we find that household religion/ethnicity, parental education, and financial circumstances were the most significant predictors of household engagement with the SECP. Important differences in program enrollment and participation are observed by household religion/ethnicity. Our study informs potential policy designs of CDA programs, especially in middle- and high-income countries, and have implications for enabling less-educated and religious/ethnic minority households to save for their children’s future.

SARS-CoV-2 (COVID-19) resulted in school closures and contingencies across the U.S. that limited access to school meals for students. While some schools attempted to provide alternative meal access points where students or parents could pick up meals, many students—especially those in low-income households—lacked adequate transportation to these access points. Thus, physical proximity to meal access points was particularly important during the pandemic. In this study, we explore how school meal access changed during the COVID-19 pandemic, especially as it relates to race/ethnicity and socio-economic status. Taking into account both the “supply” (meal access points) and the “demand” (low-income students) for free meals, we employed a two-step floating catchment area analysis to compare meal accessibility in St. Louis, Missouri before and during the pandemic in the spring and summer of 2019 and 2020. Overall, while school meal access decreased during the spring of 2020 during the early months of the pandemic, it increased during the summer of 2020. Moreover, increased access was greatest in low-income areas and areas with a higher proportion of Black residents. Thus, continuing new policies that expanded access to school meals—especially for summer meal programs—could lead to positive long-term impacts on children’s health and well-being.

Nonprofit credit counseling provides consumers with financial education, individualized financial counseling, and debt restructuring. Despite potential benefits, relatively little is known about its efficacy. This study uses administrative data to assess the relationship between counseling and consumer credit outcomes. We estimate difference‐in‐difference models to analyze credit outcomes for a counseled group relative to a matched comparison group for six quarters after a baseline period. We find evidence of a substantial credit shock around the time of counseling. Post‐treatment, counseling is associated with a persistent reduction in debt even after accounting for bankruptcies, foreclosures, debt charge‐offs, or participation in debt consolidation programs. (JEL D12)

Child Development Accounts (CDAs) are savings or investment accounts typically opened at birth or during a child's early years with the aim of promoting savings and asset accumulation for child development purposes, such as post-secondary education or homeownership. Beginning in January of 2017, the Israeli government established a universal CDA program called the Saving for Every Child Program (SECP). Under the program, every Israeli child gets a personal investment fund into which the government makes monthly contributions, and parents can further opt to make additional monthly deposits and change the default deposit location for these funds (a savings account versus an investment fund). Using population-level administrative data, this paper examines SECP enrollment and participation patterns for the first six months following the program's inception. We observe generally high rates of program participation among SECP-eligible households. However, we also find that more affluent, better educated, more employed, and ethnic majority households tend to engage with the program at higher rates and in ways that will likely yield higher economic returns in the future. These results indicate that while the SECP, as currently designed, may increase the overall financial security of Israelis, it may also contribute to growing economic inequality.

Though the COVID-19 pandemic required significant changes and adaptations for most Americans, parents faced acute challenges as they had to navigate rapidly changing schooling and child care policies requiring their children to spend more time at home. This study examines the effects of COVID-19 school and workplace policies as well as environmental and economic characteristics on parental mental health, worry, hopelessness, and anxiety. Using data from four waves of the Socio-Economic Impacts of COVID-19 Survey and regression analysis, we explore associations between parents’ mental health, worry, hopelessness, and anxiety and school learning environment, child grade and learning disability, employment characteristics, and sociodemographic factors. We find that having a child attend a private school or school with above average instructional quality was associated with better mental health of parents. Hybrid schooling options offering both in-person and online learning was associated with poor parental mental health, as was working from home. Being female or experiencing job or income loss were associated with worse mental health while having older children, a bachelor’s degree, or high income were associated with better mental health. Results can help inform school and workplace family supports as well as opportunities to reduce mental health strains at home from various policy options.

Background Pregnancy and postpartum periods represent critical times to support nutrition and household food security, especially for families with limited or strained economic resources. The Fresh Rx: Nourishing Healthy Starts study uses a randomized design to examine a comprehensive, holistic “food is medicine” program targeting food insecure expectant mothers in an area with high rates of inequitable adverse maternal and birth outcomes. Participants receive weekly fresh food deliveries from a Combined Community Supported Agriculture partner, cooking and nutrition supports, access to culinary skills education from a trained chef, and counseling and care management. In addition to providing basic cooking tools and pantry staples, the program links participants with locally available community resources and federal food assistance programs such as the Supplemental Nutrition Assistance Program and Special Supplemental Nutrition Program for Women, Infants, and Children. Design and methods This study protocol establishes a randomized control design with a control and two treatment groups to isolate distinct program components and examine variation across outcomes including household food security, maternal depressive symptoms, gestational age, and birthweight. The study design and protocol follow Consolidated Standards of Reporting Trials (CONSORT) principles to emphasize transparency and replicability. Expected impact of the study for Public Health Guided by the Cycle of Food Insecurity and Chronic Disease, study implications for public health are significant given the program’s potential for improving birth outcomes, reducing per capita healthcare costs, and filling a notable policy and program gap during the critical perinatal period for mother and child alike.

We evaluate the effect of health insurance on the incidence of negative income shocks using the tax data and survey responses of nearly 14,000 low income households. Us-ing a regression discontinuity (RD) design and variation in the cost of nongroup pri-vate health insurance under the Affordable Care Act, we find that eligibility for sub-sidized Marketplace insurance is associated with a 16% and 9% decline in the rates of unexpected job loss and income loss, respectively. Effects are concentrated among households with past health costs and exist only for “unexpected” forms of earnings variation, suggesting a health-productivity link. Calculations based on our fuzzy RD estimate imply a $256 to $476 per year welfare benefit of health insurance in terms of reduced exposure to job loss.

Nearly a quarter of U.S. households have experienced job or income losses related to the COVID-19 pandemic. Liquid assets mitigate financial distress in the face of financial shocks such as job loss, yet this relationship in the midst of the COVID-19 pandemic is unknown. Using a nationally representative sample of U.S. households (N = 4,383) who completed a survey in the early days of the pandemic, we examined pre-pandemic liquid assets as a moderator of the relationship between job and income loss and difficulty meeting financial obligations and use of high-cost financial resources. Estimates from propensity score-weighted linear probability models indicated that greater liquid assets lessened the probability of experiencing all eight measures of financial distress and most measures of distress among households experiencing job or income losses. Policy efforts to help households build emergency savings can help households better prepare for future pandemics while also supporting public health responses.

Many U.S. households — especially those with low- to moderate-incomes (LMI) — struggle to save for retirement. To address this issue, the Department of the Treasury launched myRA, a no-fee retirement account designed primarily to help people who lacked access to employer-sponsored plans build retirement savings. In this paper, we report findings from two myRA-focused field experiments, both of which were administered to well over 100,000 LMI online tax filers before and during the 2016 tax season. The first experiment involved sending one of three different myRA-focused email messages to tax filers immediately prior to tax season, and the second experiment involved incorporating myRA-focused messages and choice architecture directly into an online tax filing platform. Messages were chosen to address different barriers to retirement savings LMI households may face. We find that, though the general level of interest in myRA was very low in this population, interest and enrollment in myRA depends heavily on the way in which the benefits of the accounts are framed. Results from both experiments indicate that messages emphasizing the possibility of receiving a larger refund in the future were the most effective at increasing interest in myRA, while messages focused around the simplicity and ease of use of the accounts were less effective. We also conduct several sub-sample analyses to investigate the extent to which these effects differed by key household characteristics.

Low‐ and moderate‐income households often struggle to save, but the annual tax refund represents a prime opportunity for these households to save toward their financial goals or build their emergency savings. This paper presents the results of a randomized, controlled experiment embedded in a free tax‐preparation product offered in 2013 to low‐ and moderate‐income households. The experiment involved approximately 470,000 filers and assessed the impact of behavioral interventions on their savings behaviors. The results show that filers exposed to the treatments, which involved the established behavioral‐economics techniques of anchoring, choice architecture, and persuasive messaging, were more likely than a control group to save their tax refund and, on average, saved more of the refund. A follow‐up survey of these tax filers found that the treatments were associated with saving more of the tax refund six months after filing. The findings also show that anchors encouraging filers to deposit certain amounts are more effective than persuasive messaging emphasizing savings.

Increased pressure for evidence-based practices in policymaking and administration has led to the growth of a new research stream of implementation science. Little is known about how this new stream of research compares with scholarship on policy implementation within public administration. This paper provides a comparative review of more than 1,500 journal articles on policy and program implementation published between 2004-2013. Using bibliometric analysis and a content analysis of abstracts, implementation articles within public affairs journals and in the emerging implementation science stream are analyzed in terms of their content, methods, and focus. Following a multi-level implementation framework, this analysis considers the level at which research is taking place within the different venues of implementation research. Through this systematic review, this paper provides new insights about the current state of research, opening up new avenues for scholars to substantively engage with and contribute to this important area of study.

This paper presents the results of an experiment testing the roles of a savings pre-commitment and different savings-focused choice architectures on the savings deposit decisions of 845,786 low- and moderate-income (LMI) tax filers. Results suggest that pre-committing to save at the start of the tax filing process can, among certain populations, dramatically increase savings rates. Among early tax filers, pre-commitment is associated with a 20.6 percentage point increase in savings deposits and a $418.86 increase in the amount deposited to savings. We observe more modest effects of pre-commitment on a general sample of tax filers. We also see strong evidence that choice architectures emphasizing savings strongly impact the deposit decisions of tax filers. The experiment also revealed cautionary evidence that the structure of pre-commitment can solidify decisions, making it then harder to later nudge those who opt-out of savings to change their minds. These findings may be broadly applicable to settings beyond the tax time moment – such as to applications that seek to encourage particular behaviors (like work or exercise) on the part of its participants.