@OPRE_ACF @MDRC_News published an RCT of Paycheck Plus - Atlanta, evaluating a significant expansion of the Earned Income Tax Credit (EITC) for low-income childless workers. Quick take: High-quality RCT finds no meaningful effects on workers’ economic well-being over three years.

Program:

  • Per the study: “Paycheck Plus offered childless workers a credit, referred to in the program as a bonus, of up to $2,000 at tax time and extended benefits to eligible workers earning up to $30,000 per year, twice the maximum income limit of the federal EITC.”

Study Design:

  • The study sample comprised 3,972 low-income workers in Atlanta. Based on careful review, I believe this was a high-quality RCT (e.g., large sample, excellent baseline balance, negligible sample attrition).

Findings:

  • The program had no discernible impact on cumulative worker earnings - measured either with or without the bonus - over the 3 years the program was delivered, nor on workers’ employment rates over the 3 years.

Comment:

  • One reason for the disappointing impacts may be that only about half of workers eligible for the bonus each year (e.g., because they worked) actually received a bonus. A similar RCT in NYC where bonus take-up was higher (~60%) found some impacts - albeit small.

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