Publications
+ Isaac, Elliott and Haibin Jiang. "Tax-Based Marriage Incentives in the Affordable Care Act", Accepted at National Tax Journal (PDF, Data)
The Affordable Care Act (ACA) introduced a premium tax credit to help low-income families purchase insurance and an individual mandate penalty to encourage purchasing insurance, but a couple's total tax credit and mandate penalty may differ depending on whether they are married. We use a sample of married and cohabiting couples in the 2012-2017 American Community Surveys and leverage variation in the marriage subsidy created by the ACA's premium tax credit, individual mandate, and Medicaid expansion. Using an instrumental variables approach, we estimate a significant though small positive marriage response that is robust to extensive controls and a placebo sample.
JEL: H24, J12, I18
+ Isaac, Elliott. Forthcoming. "Suddenly Married: Joint Taxation and the Labor Supply of Same-Sex Married Couples After U.S. v. Windsor" Journal of Human Resources (PDF, Data)
Press: JHR Research Highlights
A joint taxation system can exacerbate the deadweight loss of taxation due to labor supply responses, but evidence is scarce. I provide direct evidence of the efficiency costs and labor supply effects of joint taxation in the United States by leveraging tax variation created by federal same-sex marriage recognition following the 2013 United States v. Windsor Supreme Court ruling. I find moderate hours responses to taxation among predicted primary earners and larger labor force participation responses among predicted secondary earners. I also show that joint taxation is less efficient and generates less tax revenue compared to individual taxation. My findings suggest that there are efficiency gains to lowering tax rates for secondary earners, but whether greater efficiency is worth the lower associated tax equity across families remains an open question.
JEL: D10, H21, H24, J22
+ Friedberg, Leora and Elliott Isaac. 2024. "Same-Sex Marriage Recognition and Taxes: New Evidence About the Impact of Household Taxation." Review of Economics and Statistics 106 (1): 85-101. (PDF, Data)
The U.S. income tax code encourages marriage for some and discourages marriage for others, but same-sex couples were only recently exposed to these marriage incentives. We estimate marriage responses by exploiting variation in the recognition of same-sex marriages for tax purposes, versus earlier papers that leverage smaller tax code changes. Using the American Community Survey, which reports cohabitation and marriage, we estimate a significant though small marriage elasticity relative to research on different-sex couples, with further analysis suggesting a higher elasticity for low-earning households. The 2018 Tax Cuts and Jobs Act is predicted to increase marriage among high-earning cohabiting couples.
JEL: J12, H24, D10
+ Friedberg, Leora and Elliott Isaac. 2023. "Marriage in Old Age: What Can We Learn about Policy Impacts on Same-Sex Couples?" National Tax Journal 76 (3): 679-706. (PDF, Data)
Press: NTJ Forum: Gender and Public Policy Webinar
Tax or transfer benefits in the United States are often conditioned on marital status, creating complicated incentives that reward marriage for some couples and penalize it for others. Same-sex couples, who only recently gained the right to marry, now face the same marriage incentives that different-sex couples faced for decades. We highlight marriage incentives affecting older couples, who have rarely been studied. Using the American Community Survey, we estimate decreases in the propensity to marry among older, previously married women, which are consistent with remarriage disincentives from Social Security and marriage disincentives from Medicaid that are more salient for women.
JEL: J12, H55, I13, J16
+ Ge, Suqin, Elliott Isaac, and Amalia R. Miller. 2022. "Elite Schools and Opting-In: Effects of College Selectivity on Career and Family Outcomes." Journal of Labor Economics 40 (S1): S383-S427. (PDF)
Press mentions: NBER Digest, Washington Post (1,2), The Atlantic, Bloomberg, CNBC, MarketWatch, Inside Higher Ed (1,2), CBS, Business Insider
Using College and Beyond data and a variant on Dale and Krueger's (2002) matched-applicant approach, this paper revisits the question of how attending an elite college affects later-life outcomes. We expand the scope along two dimensions: we do not restrict the sample to full-time full-year workers and we examine labor force participation, human capital, and family formation. For men, our findings echo those in Dale and Krueger (2002): controlling for selection eliminates the positive relationship between college selectivity and earnings. We also find no significant effects on men's educational or family outcomes. The results are quite different for women: we find effects on both career and family outcomes. Attending a school with a 100-point higher average SAT score increases women's probability of advanced degree attainment by 5 percentage points and earnings by 14 percent, while reducing their likelihood of marriage by 4 percentage points. The effect of college selectivity on own earnings is significantly larger for married than for single women. Among married women, selective college attendance significantly increases spousal education.
JEL: I23, I26, J12, J16, J22
+ Button, Patrick, LaPorchia A. Collins, Augustine Denteh, Mónica I. García-Pérez, Ben Harrell, Elliott Isaac, and Engy Ziedan. 2021. "Teaching Controversial and Contemporary Topics in Economics Using a Jigsaw Literature Review Activity." Journal of Economic Education 52 (4): 286-295. (PDF)
Most courses are taught almost exclusively using lecture and, despite gaps in textbook coverage of empirical economics, do not incorporate academic readings. The authors of this article present a “jigsaw literature review” cooperative learning activity to address these shortfalls. The jigsaw guides students through formulating a position by synthesizing key ideas from readings with diverse perspectives on a common topic. The authors provide detailed guidance on conducting the activity in upper-level economics courses, based on their experiences while teaching labor economics, public economics, urban economics, health economics, and econometrics. They argue that their activity provides a meaningful way to integrate recent research, policy topics, and diversity issues while promoting student-student interactions. Sample course materials and additional resources are provided for ease of implementation.
JEL: A22, A23
+ Isaac, Elliott. 2020. "Marriage, Divorce, and Social Safety Net Policy." Southern Economic Journal 86 (4): 1576-1612. (PDF)
I use variation from the 1990s in the Earned Income Tax Credit and welfare reform to estimate the effects on marrying and divorcing. I examine flows into and out of marriage, use test scores to predict who is most likely to be affected by the policy changes, and employ a flexible functional form to estimate heterogeneous effects. I find that low-earning single parents are more likely to marry due to the EITC expansion and lower welfare generosity, while mid-earning married parents are less likely to divorce and high-earning married parents are more likely to divorce due to the EITC expansion.
JEL: D10, H24, H53, J12
Working papers
+ "Safety Net Substitution and Implications for Cash Transfers: Evidence from EITC and TANF" with Augustine Denteh (PDF)
The mid-1990’s welfare reform introduced Maintenance of Effort (MOE) spending, requiring states to spend their own funds on their Temporary Assistance for Needy Families (TANF) programs to receive federal TANF block grant funding. One category of MOE spending includes refundable tax credits, effectively introducing an explicit tradeoff between state Earned Income Tax Credits (EITCs) and TANF: if a state increases state EITC spending, it can reduce spending in other MOE categories. We use administrative data and a simulated instrument approach to estimate the degree of substitution between state spending on TANF basic assistance and its state EITC and decompose this effect into extensive and intensive margin responses. We find that a $1 increase in state EITC spending causes a $0.75 decrease in state spending on TANF basic assistance, of which 65.0% is due to caseload reductions. Since 2001, our estimates suggest that state safety net substitution explains 65.8% of the decline in TANF basic assistance spending in states with refundable state EITCs.
JEL: H75, H71, I38
+ "Spousal Labor Supply: Decoupling Gender Norms and Earning Status" (PDF)
Many household labor supply models divide couples by sex and identify separate male and female labor supply parameters. However, institutional factors in the labor market suggest that men are more likely to be primary earners in their household, meaning that intra-household gender gaps in labor supply may reflect both gender norms and earning status. I use a novel identification approach to disentangle the role of gender norms in intra-household labor supply by estimating collective labor supply models for different- and same-sex married couples. Among childless couples, I present point estimates and construct unified bounds showing that gender norms significantly increase the weight placed on women’s utility by 1.1–5.1%, leading to lower labor supply. A back-of-the-envelope calculation suggests that the effect of gender norms on married, childless couples’ labor supply is equivalent to a substantial widening of the gender wage gap.
JEL: J16, J22, D10