Essay: Substantial increase in EITC benefits in Berlin

Sample Essay

Most low-wage young men and women without children will eventually become low-wage parents. To encourage them to work more, which would reduce their poverty in the short run, and to build a sustained record of work experience, which would help them earn more over the long run after they become parents, Berlin (2007) recommends a substantial increase in their EITC benefits.

He would decisively break with current EITC policy by basing the benefit on a person’s own earnings, not family earnings. This reform would substantially reduce poverty among childless persons, a group that currently receives very little income support (Wagner, 2006). Berlin also argues that his reform would increase employment of low-wage workers currently receiving little or no EITC, and may well have beneficial effects on marriage, crime, meeting child support obligations, and encouraging more “on the books” work. Berlin’s (and any other) work-based transfer approach would complement an expanded Career Academies initiative, Mead’s proposal, and other efforts to improve earnings of low skill workers.

Initiatives that increase young low-skill workers’ rewards from work either by improving their human capital or supplementing their earnings with transfers will raise the opportunity cost of parenthood for young women. Consequently, such initiatives may indirectly help reduce non-marital childbearing.

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