Author(s)  
Jacob Bastian
Lance Lochner
Parents spend considerable time and resources investing in their children's development. Given evidence that the Earned Income Tax Credit (EITC) aects maternal labor supply, we investigate how the EITC affects a broad array of time-use activities, focusing on the amount and nature of time spent with children. Using 2003-2018 time-use data, we find that federal and state EITC expansions increase maternal work time, which reduces time devoted to home production, leisure, and time with children. However, for children of all ages, almost none of the reduction comes from time devoted to "investment" activities, such as active learning and development activities.
Publication Type  
Working Paper
File Description  
First version, August 13, 2020
JEL Codes  
D13: Household Production and Intrahousehold Allocation
H24: Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes
H31: Fiscal Policies and Behavior of Economic Agents: Household
H53: National Government Expenditures and Welfare Programs
I31: General Welfare
I38: Welfare and Poverty: Government Programs; Provision and Effects of Welfare Programs
J13: Fertility; Family Planning; Child Care; Children; Youth
J22: Time Allocation and Labor Supply
Keywords  
EITC
tax policy
time use
child investment
female labor supply