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IZA Discussion Paper No. 10414
December 2016
Lone Parents, Time-Limited In-Work Credits and the Dynamics of Work and Welfare
Mike Brewer, Jonathan Cribb

Time-limited in-work credits are cheaper, and more targeted, than conventional in-work credits, but are thought to have small to zero long-term impacts. We study two time-limited in-work credits introduced in the mid-2000s in the UK and find they reduced welfare participation and increased employment. Both policies increased job retention once recipients were in work and boosted employment even after the payments were stopped. Conditioning on hours of work was important. Paying a credit to those working 16+ hours a week only increased part-time work, while conditioning on full-time work reduced part-time work and increased full-time work.

Communications
Mark Fallak
mark.fallak@liser.lu
+352 585-855-526
World of Labour
Olga Nottmeyer
olga.nottmeyer@liser.lu
+352 585-855-501
Network Coordination
Christina Gathmann
christina.gathmann@liser.lu

The IZA@LISER Network is a global community of scholars dedicated to excellence in labor economics and related fields, now coordinated at the Luxembourg Institute of Socio-Economic Research (LISER) following its transition from Bonn.

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