Volume 10, Number 1 (Winter) 1975
Smith, James P. 1975. "On the Labor-Supply Effects of Age-Related Income Maintenance Programs." Journal of Human Resources 10(1):25-43.
In this paper a model is developed which is designed to capture the channels through which income transfer programs are likely to affect working hours of family members. The model demonstrates that the appropriate framework is neither a pure one-period or life-cycle one, but rather one that contains elements of both models. The final section illustrates a method of estimating the labor-supply reactions to income maintenance programs. The labor-supply effects are functions of the duration of a family's participation and the relevant importance of male market investment.
The author, formerly a Research Associate with the National Bureau of Economic Research, is now with the RAND Corporation. I would like to thank H. Gregg Lewis, Yoram Ben-Porath, and Dennis DeTray for their assistance. The principal work on this paper was done when I was a consultant to the RAND Corporation in the summer of 1972, and the paper is a condensation of the final report to the granting agencies. The work was cosponsored by the Office of Economic Opportunity under Grant 90088-D-72-01 and the Economic Development Administration under Grant OER 388-G-71-11. During the last year, additional support was received by a grant from the Ford Foundation to the National Bureau of Economic Research.
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