Spending Responses to High-Frequency Shifts in Payment Timing: Evidence from the Earned Income Tax Credits

• 成果类型: Article
• 署名作者: Aladangady, Aditya; Aron-Dine, Shifrah; Cashin, David; Dunn, Wendy; Feiveson, Laura; Lengermann, Paul; Richard, Katherine; Sahm, Claudia
• 署名单位: Stanford University; University of Michigan System; University of Michigan
• 刊物名称: AMERICAN ECONOMIC JOURNAL-ECONOMIC POLICY
• ISSN/ISSBN: 1945-7731
• DOI: 10.1257/pol.20200590
• 发表日期: 2023
• 页码: 89-114
• 关键词: economic stimulus payments; consumption response; consumer-behavior; savings; EITC; hand

摘要

This study explores the spending response to tax refunds for Earned Income Tax Credit recipients using a novel dataset combining transaction-based measures of retail spending with administrative IRS data on tax refunds. Our dataset allows us to exploit variation in the timing of EITC refunds, including changes related to the 2017 PATH Act, along with cross-state differences in refund magnitudes to identify spending responses. Results show EITC recipients spend about $0.30 per refund dollar ($1,150 for the average refund) within just two weeks of issuance, suggesting stimulus targeted at this population may provide a quick boost to aggregate demand.