Kershaw Award-Winner Katherine Michelmore on How Expanded Tax Credits Benefited Family Well-Being

[KATHERINE MICHELMORE]

When you talk to people about what they do with the credit, they know that the credit is in part, they get it in part because of their kids and they know they're getting it for working and they know they're getting it for their kids. And so, I think that's reflected in how they think about spending the credit as well. Like they think that at least some of that should go towards improving their kids’ lives, even if in very small ways, like going out to dinner or making sure they can have a birthday party, that kind of thing. And those things, as adults, we might not think too much of them, but I think for kids that can actually be really like consequential and you can think about that really doing a lot of good for the family and for the relationship between parents and kids.

 

[J.B. WOGAN]

I’m J.B. Wogan from Mathematica and welcome back to On the Evidence.

Our guest for this episode is Katherine Michelmore, an associate professor of public policy at the University of Michigan's Gerald R. Ford School of Public Policy. Much of her research focuses on the Earned Income Tax Credit and the Child Tax Credit and their effect of family well-being. Some of her recent work has looked at the effects of temporary expansions of both credits during the COVID-19 pandemic, which is part of a growing body of evidence informing state and federal policy proposals to make permanent some or all of those changes to the tax credits.

One working paper she co-authored about an expansion of childless Earned Income Tax Credit was cited in a policy paper from Kamala Harris’s presidential campaign, which we discuss briefly in the interview.

Katherine is this year’s winner of the David N. Kershaw Award and Prize, which is awarded to scholars under 40 whose contributions to research-based knowledge have advanced the design, implementation, and evaluation of public policies.

David Kershaw, for whom the award is named, was the first president of Mathematica. In the spring of 1979, he helped guide the establishment of the Association for Public Policy Analysis & Management or APPAM, before his death from cancer later that year at the age of 37. The award in his memory was created in 1983 and is jointly administered by Mathematica and APPAM.

Speaking of APPAM, On the Evidence will be at APPAM’s Fall Research Conference in National Harbor in late November. If you are attending the conference, please me a message. I’d love to meet some of our listeners in person. I’ll include an email address in our show notes where you can reach me.

With that, I hope you enjoy my conversation with Katherine Michelmore.

[J.B. WOGAN]

I wanted to ask, Did you always want to be a public policy researcher, or how did you first become interested in that field in general?

 

[KATHERINE MICHELMORE]

Yeah, I don't, I mean, it's kind of funny. I don't think I always wanted to, for sure. Certainly not as a child. It was not like I wanted to be a public policy researcher when I grew up. I think when I got to college, I, actually like, I kind of stumbled into an econ class. Like I had taken AP economics in high school, but I, it didn't, wasn't a natural thing that I didn't think I was going to go into economics. But it was like one of those silly things. Like a lot of my friends were taking econ 101 and I was like, Oh, I did really well in econ in high school. So, you know, why don't I try this out? And I actually just really enjoyed it. and like, you know, I think a lot of people, I had some really great mentors.

 

So one of my undergrad, my undergrad mentor, Joyce Jacobsen, was very influential, I think, in helping me kind of navigate into the field of, you know, I think initially I was, I wanted to get a PhD in economics and then, you know, I just kind of veered a little bit, you know, a little bit of a tangent onto public policy, by, you know, after college, I worked at the Urban Institute and that kind of, I think, really motivated me to do, like, to want to do more like work that was relevant to, you know, the greater good. So I think that's kind of how I got started. You know, I think, and I went to a liberal arts college and I initially, I actually really wanted to go back and teach and like be at a liberal arts college. But again, like a couple of little sidesteps here and there put me more towards the research path.

 

I mean, I love teaching too, but I think that's kind of my circuitous path here.

 

[J.B. WOGAN]

Was Joyce Jacobsen interested in public policy herself? What was her area of focus?

 

[KATHERINE MICHELMORE]

She actually did work on gender and economics, so I remember taking like a gender and economics class with her early on in undergrad, and just being, it's just really eye opening, I think, because, you know, taking economics and intro to economics in high school and early in college, you know, you just think of kind of basic supply and demand curves, but it was like taking some of those more elective classes where it was just giving me a sense of like, you know, how expansive economics could be.

 

And so it was just like really interesting to think about all these other issues that I hadn't really considered being like part of economics or part of public policy that got me interested in that.

 

[J.B. WOGAN]

Were your parents academics in their own right? What was, what did your parents do? Anything related to what you do now?

 

[KATHERINE MICHELMORE]

No, actually, like very much not related at all. In fact, you know, I think, I think they still like, don't quite understand what I do every day. And you know, sometimes like, they'll like, you know, they know that I have to publish, but like, they'll often ask like, Oh, you get your summers off. And I was like, yeah, I know I get them off, but you know, it's really a time to get research done.

 

No, my dad was an accountant. So we'll kind of come back into that later, I think. And you know, my mom didn't go to college. I'm actually the first in my family on her side to go to college. So, she was more of a kind of pull yourself up by your bootstraps kind of person. She, I mean, she married my dad when she was 22, and then like took community college classes and ended up working for the federal government. She worked for what became the Department of Homeland Security. So she spent her whole career kind of working in like administrative roles for the government.

 

But yeah, academics are not in my family. I'm, I think I'm the first in my family to be in academia. So it was definitely not a path that I kind of was, familiar with before kind of embarking on it myself.

 

[J.B. WOGAN]

That's really interesting. So you mentioned your father was an accountant. Maybe this is where we're going to go with this, but a lot of people know you because of your research on tax credits and the Earned Income Tax Credit and the Child Tax Credit. I was curious how you settled in on focusing on those topics.

 

I mean, they're, I really liked them. I really loved to cover them as a journalist. They seem, because they were, they had bipartisan support, they, there was some evidence of effectiveness, but they're, they seem a little bit more like hipster or niche to me as a policy topic. So what, what attracted you to these, to these credits?

 

[KATHERINE MICHELMORE]

Yeah, that was kind of another maybe serendipitous thing. You know, my dad growing up used to always say like, don't become an accountant. So it was not at the forefront of my mind that I was going to do anything related to taxes. But I like to say that it's, it's in my genes a little bit. But yeah, it's kind of funny how I got started.

 

So after college, I lived in D.C. and I was working as a research assistant at the Urban Institute and a lot of my colleagues there used to volunteer to do free tax preparation, for the IRS VITA sites. So they provide free tax preparation services to low-income residents in the D.C., Maryland, Virginia area, and it just sounded like an interesting volunteering opportunity for me.

 

So, I went through the training and there's a test you have to take that is actually quite challenging, certify to, to be able to do free tax prep. I mean, you want it to be probably challenging so that the people who are doing your taxes are qualified to do it. It's nothing like passing a certified like the CPA exam. I'm sure that accountants have to take professional accountants have to take, but, it was definitely something that I had to like, spend a lot of time passing that exam. And then I used to just spend my Saturday mornings, during tax season doing free tax preparation, at, you know, a community center in D.C.

 

And again, it wasn't something that I had kind of gone into like knowing I wanted to study taxes, but It was just purely a volunteering opportunity and I actually just really loved it. I said it was like the perfect volunteering opportunity for me because I really liked the numbers aspect of it. I liked kind of just calculating people's taxes in a very nerdy way.

 

I just thought it was really fun and satisfying to see like how much we were getting for the refunds. But it also really was paired with like being able to hear people's stories. So I just, to hear people, you know, people will tell you a lot and you're sitting with them for an hour, doing their taxes.

 

You hear a lot about their life stories, and it was just really interesting to me to hear people talk about how much of a difference the taxes made, you know, the refunds made for their lives. And, you know, there were always, you know, know, scenarios where, you know, I could tell people really counted on getting a certain amount every year because anytime we got to the end result and it was more or less than they expected, especially if it was less, like people were really stressed out about it.

 

And like, you know, so I could just really see how important it was for people's lives. And so that really, I think, sparked my interest in studying the EITC in particular. I'll say like one of my, and I've continued it, to volunteer whenever I can for these services. I did it throughout grad school and the last couple of years I haven't been able to do it, but it's been really fun.

 

But my favorite story is, you know, I did someone's taxes once. She was self-employed and her sole source of income was from selling 22 golden doodle puppies.

 

[J.B. WOGAN]

Oh my gosh.

 

[KATHERINE MICHELMORE]

And just like, just enumerating all of the random expenses one incurred from being like a dog breeder. It was just like a really fun, a fun experience.

So, so that was really how I started down this path.

 

[J.B. WOGAN]

 

Okay. And for listeners, just in case, EITC, I'll just name that is the Earned Income Tax Credit. So anytime we say, I don't, I don't know if people say CTC as well, but that would be the Child Tax Credit.

 

[KATHERINE MICHELMORE]

 

Yes. CTC is definitely in there as well. So

 

[J.B. WOGAN]

 

Okay. All right. It's a common acronym as well. So, I know when, like I like using IMDb, I'll look up, an actor and what, and they'll have a feature where you can see what they're known for.

 

I kind of wanted to draw an analogy. If someone, if there was an IMDb for like, public policy research, what would be the, like the, the main papers and main findings that people should know you for? Like, what, what have, what have you found through your research on the Earned Income Tax credit and Child Tax Credit that people should associate with your scholarship.

 

[KATHERINE MICHELMORE]

 

Yeah, I like that, an IMDb page for public policy. That's great. So I think like, so I started with the EITC. I think that was the bigger program and that's the program that's been more targeted towards low-income families in particular. And so when I started studying it in graduate school, at the time, what we really knew, the thing we knew most about it was, how it impacted employment among single mothers.

 

And so there was a pretty big growing literature showing that the expansion of the EITC, particularly in the early 1990s, led to a pretty large increase in employment among single mothers. But we didn't know a lot of other impacts of the EITC at that time. And so I was really interested in the impacts on the second generation, so what is the impact of the EITC on the children of people who are getting it?

 

So that is where I started my focus. And so, you know, there was a little bit of work done on, sort of contemporaneous effects of the EITC on kids outcomes, like test scores and a little bit on health, but what I was also really interested in was the fact that, you know, these kids often get the EITC for a long portion of their childhood. So the nice thing about the EITC, you know, like unlike some of our other programs like the cash welfare program now, there's not a time limit where you can only claim it for a certain number of years. So as long as families continue to meet the income criteria and have children in the household They can claim the EITC for as many years as they want.

 

And so I think I've seen numbers recently suggesting that about half of kids will receive the EITC at some point in their childhood. So I was also interested in this dynamic piece of it, of how long are kids receiving the EITC and how does their childhood exposure to the EITC affect their later life outcomes?

 

So I have a number of papers that use that kind of identification, so to speak of like looking at how cumulative exposure to the EITC in childhood is associated with outcomes in adulthood and trying to, you know, put a causal lens on that by taking advantage of a lot of, federal and state expansions to the EITC over time that kind of generate this nice quote unquote random variation in how much EITC benefits kids are exposed to.

 

So, you know, a kid born in 1990 in, let's say like New York state is exposed to a different set of EITC benefits over their lifetime than a kid born even in the same state, like five years earlier. So kind of leveraging all that variation, I've done a lot of work to look at kind of kids’ longer run outcomes. So one paper I think I'm very well known for is a paper that looks at educational attainment. So looking at how kids who are exposed to larger EITC benefits in childhood are more likely to complete high school and complete college and have higher earnings in adulthood. And that kind of spawned off in a couple other sets of outcomes.

 

I have a related paper that looks at teen fertility and family formation that also shows that kids, like not surprisingly, if kids are, you know, more likely to have more education, we also see declines in things like teen fertility and evidence, particularly that women, young women are postponing family formation probably because of these education outcomes. so that's kind of a set of papers that I have looking at those things.

 

You know, I think beyond that, then I started thinking about kind of the consequences of having work requirements in programs. So this is something that's increasingly talked about in public policy is should our social policies be contingent on people working and the EITC, that's baked into the structure of the program. You have to have earnings to get it. And so I started thinking about who are the people who are responding to these work incentives and what are the doubt, like some potential consequences of having more. So, for instance, having your mom go to work.

 

What's what are the potential consequences of that? So I have some work that looks at, kind of what types of single mothers are most responsive to the credit and it turns out it's actually mothers with very young children. So mothers with kids under five are actually the most likely to enter the labor force when the EITC becomes more generous. And so I think that leaves like a very big question of like, well, what is happening to those children when the moms are going to work? So I have some work that looks at kind of the implications for child care arrangements finding that, you know, there's kind of it's kind of a mixed bag I would say, that you see that kids are more likely to be taken care of by someone other than their parents when moms go into the labor force, which is probably not surprising, and it’s kind of evenly split between going into more like physical care formal childcare arrangements, which tend to be of higher quality than other types of arrangements, but also a good chunk of those kids are being cared for by a relative, where there's just, you know, there's just uncertainty I think about the relative quality of that. So, so that's kind of another, bucket of things.

 

And then I'll just kind of finally, another strand I think is, is really focusing on the household finance implications of the EITC. So, is the EITC kind of helping families build wealth and accumulate savings and reduce debt?

 

So I've done some work looking at, families, kind of using the EITC to pay down debt. And it does seem like it's, it's leading to increases in, in wealth, which I think have, again, points to kind of, improvements in the long run. So that's kind of a snippet of some of my EITC research.

 

[J.B. WOGAN]

 

Okay. And I'm sure that that that's only, only, the tip of the iceberg, but I appreciate that potted summary there. I wanted to ask, So the, the first of those three buckets that you were describing, I, I think people probably, initially think of the Earned Income Tax Credit as a kind of pro-work policy that's really aimed at trying to incentivize work and lift an anti-poverty measure for, for the, the, the workers. But you were interested, you, you thought of, these other implications for the, the other members of the household and what it might mean for the kids of these parents, who are incentivized to work, was there some insight that you had from working with the low income tax filers back in the day that, that made you think about what the implications were for other members of the household? Or how did you, how did you, how did, what, how did that thought occur to you that there are other interesting research questions beyond, beyond just what's happening to the worker themselves?

 

[KATHERINE MICHELMORE]

 

Yeah, I think a bit from that, you know, I'd certainly hear stories from people, and there's been a lot of like excellent qualitative work done asking EITC recipients, like how they spend their credit. And you hear a lot of these stories about people wanting to do things for their kids, you know, even if they're very small things like taking their kids out to dinner or, you know, going on a road trip, family vacation, even if it's for a short period of time, or not very far away that you hear. I think people like people, again, when you talk to people about what they do with the credit, they know that the credit is in part, they get it in part because of their kids. They get, they know they're getting it for working and they know they're getting it for their kids. And so, you know, I think that's reflected in how they think about spending the credit as well.

 

Like they think that at least some of that should go towards, you know, improving, improving their kids’ lives, even if in very small ways, if it's, you know, like I said, like going out to dinner or, you know, making sure they can have a birthday party, that kind of thing. So I think, and those things, I think are really like, you know, as adults, we might not think too much of them, but I think for kids that can actually be really like consequential and, you know, you can think about that really. a lot, doing a lot of good for the family and for the relationship between parents and kids.

 

But, you know, there's a much nerdier reason why I got down that path, this path too, is, when I first started looking at, wanting to look at education outcomes for kids, I was actually really first interested in this, like, quirk, it's not really, this, this, provision in the tax code, which, says that, to claim the EITC, if you want, if you have to claim a child for the EITC, they either have to be under the age of 19. Or if they're between the ages of 19 and 23 and they're full time students you can claim them. So I was really interested in like essentially seeing, I was broadly interested in trying to see whether families are kind of taking note of this and like whether that incentive, you know, if your kid's in school, you get to claim this extra, you know, larger benefit, if that was creating an incentive for kids to stay in college, that was like the initial goal and it just became too tricky to try to identify that. I've seen others try to, try to tackle this question too and it gets a little tricky. But that's really actually where it started was like just, you know, learning more about the credit and realizing there was this kind of interesting quirk of, of, the requirements that, you know, you could get this benefit if you were in college, but not otherwise, so I was, I was interested in whether it was actually encouraging people to go to college. And then it just kind of expanded from there to think about, well, you know, there's other than this like one-time credit when you're, you know, 19 to 23, your whole childhood, you're getting more money from this credit. So how is that impacting kids outcomes?

 

[J.B. WOGAN]

 

Can I ask a silly question about the design of the EITC? Is it, is it for, is it only for parents with dependents in the household or can you, can you receive it if you don't have kids as well?

 

[KATHERINE MICHELMORE]

 

There's a very small credit for people who don't have kids. It's often colloquially referred to as the childless EITC. But just to put things in perspective, the maximum credit that you can get if you don't have a kid right now is about $500. Whereas for, if you have multiple kids in the household, you can claim over $6,000/$7,000 in federal EITC benefits.

 

So it's just an order of magnitude smaller. There has been a lot of motivation to try to increase the benefit for childless filers. So in 2021, there was a temporary expansion that tripled the size of it to $1,500, but that expired, along with some of those other, American Rescue Plan Act reforms.

 

So, that one has, it's unfortunately been a very small credit and it's only it's only applicable to people with very, very low income. So it's, it's not technically just for people with kids, but in practice, it's mostly people with kids who get it.

 

[J.B. WOGAN]

 

Okay. All right. So I want to ask about data sources because I noticed that one of your recent papers used data from an app called Propel, which I had not heard of before. I was hoping you could explain what Propel is. How you worked with the company to collect data on the child tax credit for that research and how those data are different from what you might get from current surveys conducted by federal agencies.

 

[KATHERINE MICHELMORE]

 

Yeah, so Propel’s this company that makes this app. The app’s name has changed over time, but I think it is now called Propel, and they make an app for food stamp users. And so this is going to maybe sound crazy, but before this app existed for food stamp users to find out how much money they had left on their food stamp account, they'd have to call like an 800 number or I think at the grocery store, you might be able to find this out, but there's no way for them to track in real time, like how much, how many, how much benefits they have. So this app kind of works like your bank account app on your phone basically is like they just kind of log into their account and they can see in real time, like how much money they have on their, on their food stamps.

 

And they can, there's other things they do on the app. They can get coupons and, and, other things like that. But the company also conveniently, does a monthly survey to a subset of their users. And I should say, I think something like 25 percent of food stamp users use this app. It's a pretty large, percentage of, of users. And it, you know, I think people find out about it often through like caseworkers or word of mouth, but a large share of food stamp users, actually use this app to track their benefits. And so my colleague, Natasha Pilkauskas, she had been working with them on an unrelated project, so she had already had kind of a contact there. And when the, change to the Child Tax Credit was announced in 2021, we naturally thought, oh, this might be a way for us to propel might be a way for us to get some real-time, evidence on how the CTC is impacting families. So they, they were already. administering this survey, it was kind of like an, it was, it's named something very similar to the census pulse.

 

It's like the household pulse survey or something like that. And they were asking questions that were what we might think of as like, we characterize as material hardship questions, things about, like, does the family experience food insecurity? Are they having trouble, paying their bills? Do they, are they unable to go to a doctor because they can't afford it? Those types of questions. And they just asked a number of different like mental health questions as well. And a broad number of economic questions about, you know, their monthly income, the various debts that they were holding, and some household or living arrangements. And this was administered every month.

 

So once this policy was announced and Propel was really interested in supporting us and giving us data so that we could answer some questions we were interested in. And they actually also, the nice thing about working with them is, it was very easy for us to change some of the survey questions. So basically, prior to the, you know, we needed to do this pretty quickly because, you know, the policy is announced in March and was going to be implemented in July. So we needed a couple months of pre-period data to be able to analyze the impact of the program. So they let us make some changes to the survey, just add a couple questions. You know, importantly, they ask questions about whether the families like receive the child tax credit each month, and if they didn't receive it, why they didn't receive it, and they ask them questions like how they spent it and so on and so forth. So it was just really nice to work with them because, you know, they're giving, they were administering the survey in real time, we could get the data like immediately after the survey closed. We could add these extra questions we were interested in. So it really gave us a much richer portrait of what was happening on the ground with these families than is typically available in other surveys. So, you know, the only other survey that was done, you know, at the national level that was done, it was the census pulse data, that was also trying to get this kind of real-time information. But, I would argue that we had a lot more measures of material hardship that were, really helpful for us to gain some insights into how families were spending the credit.

 

Now, of course, I think that the question that gets raised is, you know, who, who's in this data set? How can we, you know, I think these, these federal surveys are obviously like, you know, very well-vetted and there's a lot of thought that goes into representativeness and how and sampling, you know, company like Propel, is, you know, they're doing what they can there too.

 

I don't want to downplay the work that they're doing, but it's just a very different beast. And so we, and all of the papers we've done on this, we've, we've done our best to try to. Look at the characteristics of the people in our Propel data and see how well they match to characteristics of people in national surveys, like the American Community Survey, their Current Population Survey.

 

And what we've broadly shown is, are the sample of people from Propel, you know, they're again, they're food stamp users largely, and they largely look like people who are reporting that they get food stamps or people who are reporting that they're living in poverty, in these other national data sets.

 

That sort of gave us some reassurance that, that our, our survey, you know, largely looks like a population of people, of poor people that we would get from a broader survey. So that gives us a little bit more confidence in the quality of the data.

 

[J.B. WOGAN]

That's great that they were so enthusiastic about a research partnership. Were they doing the survey for research or what? Why were they already doing a kind of pulse survey like that? That's that sounds like an amazing foundation to work from.

 

[KATHERINE MICHELMORE]

Yeah, I mean, they were, they were, they released, like, they released reports every month. I mean, you know, I think their goal was to try to get a sense of, you know, how well these families were faring. And so they were, they were doing, a bit to kind of release reports, but they I think they've been working hard.

 

I think they just hired like a year or so ago, a more, comprehensive, like research team. But at the time, I think that, you know, they were administering the survey and just doing some basic, they're putting out some basic statistics, but they didn't really have, I think, at the time, like the capacity to be doing like, you know, larger scale research studies. And so I think they were really happy to, partner with us because I think they thought that they didn't have the in house capacity to do that kind of work, but they were very interested in, in seeing the impacts of the CTC.

 

[J.B. WOGAN]

That's interesting. So, your research on tax credits has garnered a lot of attention from reporters and policymakers. I'm always interested in the communications aspect of policy research, and so I wanted to ask how you've tried to prepare for engaging with those audiences with, you know, those, those lay non non-research audiences, and do you have any helpful advice for translating findings for non-research audiences?

 

[KATHERINE MICHELMORE]

Yeah, I mean, this can be a tricky one. A couple of years ago, I remember, you know, when they were, there was the, the CTC was being rolled out and there was this concern about, work requirements and how parents were going to drop out of the labor force because of the CTC. You know, I there's this whole question that was going around about, well, what are the what are people's labor supply elasticities and trying to explain like a labor supply elasticity to a lay audience was quite challenging. And I actually commend a lot of the journalists that I've spoken with for being able to like, simply convey those ideas to a broader audience. So all that to say, it's, it's, it's definitely very different than an academic audience. I think in academic settings, we're really used to, you know, putting it all out on the table and, like, really rigorously defending our research methods and kind of convincing you that we've looked at all these different robustness checks.

 

And, you know, you know, kick the tires and everything is very solid. And, you know, that's not something I think that journalists are as interested in, is that whether your results are robust to a million different robustness checks. So, I think, ror me, I have to remind myself that, you know, you have to distill this down to like, what is the big picture point of, of what you're finding? And I think I've been really lucky to work with a lot of colleagues and mentors over the years that really prioritize writing simply and clearly and not, you know, overly including like a lot of jargon in writing. And so that's always been my philosophy, too, is just trying to write things, even in my academic papers, as simply as straightforwardly as possible.

 

It's not my goal to show you, you know, how smart I am with all the jargon I can put in my paper. So I think that's, that's helpful is, is, you know, keeping in mind that, you know, conveying your ideas simply is, is, you know, good for disseminating research. But I also keep in mind when talking to journalists and again, it can be really nerve wracking when you first start doing it because I think we're always, I at least kind of came like when I started talking to journalists would be really concerned that I'm going to say the wrong thing or that they're going to catch me in some like inconsistency and you know that my reputation is going to be ruined or something.

 

But, you know, most of my experience, almost all of my experience with journalists has been coming from a good place, that journalists really just want to get, get the right answer and they want to make sure that they understand your findings. And so I've always had really good luck, with speaking with journalists who are, who come from a good place like that.

 

So I keep that in mind when speaking with the media is that, you know, the point is to try to make sure that the, you know, the people you're speaking with understand your, your results. And again, like trying to try to keep things at a higher level than just trying to convince people that you've done all these different checks to make sure that your results are, are sound. I mean, that's obviously very important, but I think the big picture takeaways are also important to, to keep in mind when speaking to a broader audience like that.

 

[J.B. WOGAN]

 

Now, most of what you were talking about, I think you're talking about from a, interacting with the media, but what about, say congressional staffers or other policymakers, people, people in government who are looking to take lessons from the evidence and make policy decisions based on it. Have those experiences been, is it the same advice? Just be as simple as possible? Or are there other things that you've had to do to explain your research to that audience?

 

[KATHERINE MICHELMORE]

 

Yeah, it's a good question. I think it's a similar message of trying to be very clear and, and, and, you know, take the big picture points away from it. I think it does feel more nerve wracking, though, because it feels very consequential that like they're talking to you. And it feels like what you say is something that they might take.

 

I mean, I don't know that they'll actually use it. But I think that can be a little bit more nerve wracking. So that's where I really try to make sure that, you know, all caveats are understood. And, you know, saying a lot of, well, this is what we know so far, but we don't know the X, Y and Z. So there's a lot of that. A lot of that that happens. But again, I do think a lot of it is, you know, at the end of the day, they just want kind of like, what is the big picture takeaway from your findings? So, so I think in many ways, it's similar to speaking with the media. but in my view, it's a little bit more intimidating cause it feels a little bit more consequential potentially.

 

[J.B. WOGAN]

 

Yeah, yeah. Yeah, some live ammunition. The journalist isn't going to be able to change the EITC, but maybe the right member of Congress could, could, influence that.

 

[KATHERINE MICHELMORE]

 

Yeah. I'm increasingly pessimistic about that too, but, but yes, I think that's right.

 

[J.B. WOGAN]

So on a related point, I mean, talking about, policy makers, both, you know, this, this episode is going to air shortly after the, the presidential election. But both campaigns, Trump and Harris campaigns, have talked about expanding the child tax credit. So I was just curious, like, you know, what is it like to be an expert on something, a somewhat niche topic, that is suddenly a talking point by presidential and vice presidential candidates and in their campaign literature and stump speeches.

 

[KATHERINE MICHELMORE]

Yeah. It's really surreal. I mean, it's not like I, I'm in direct contact with anybody from those campaigns. But you know, I was a couple of weeks ago, pleasantly surprised to see, some of my work was cited in Harris's, like proposal. And like that was the only research she cited was like one paper that I, I'm working on with a couple of colleagues. And so it is really like kind of surreal. But, you know, I'd say more broadly, it, you can't ever really predict what's going to happen in the policy landscape. So it's not, I mean, it's not something I ever like encourage people to like, try to chase the, you know, the next big thing. You know, I think I’ve always just followed by the guidance of, you know, researching something I'm passionate about, and I think that's what sustains me.

 

But it is, of course, nice to see that your work is, you know, something that's being discussed in the real world because that doesn't always happen. And I think, especially in a lot of academic settings, you might feel like you're, you know, just talking in an echo chamber and nobody is actually paying attention to anything that you're writing. So it is. it is really nice to see your work being recognized.

 

So, and that's, you know, I think more broadly, what I really was, you know, you asked me about public policy, how I got into this, and I think that's something I actually really enjoy about being in public policy more broadly is that you do have a greater chance of studying a topic that might actually be, you know, implemented or reforms made to. So I think it's, it's, it's, it's really fun to be, to, to be a part of those conversations. And I feel lucky to be part of those conversations. Of course, I think a lot of times, you know, even when it's being discussed in the real world, you know, you can still talk about your recommendations and things like that and nothing ever happens.

 

But, it is, it is nice at least to hear that people are talking about the issue. So it's, it's, it's really gratifying feeling.

 

[J.B. WOGAN]

 

So I, the last question to wrap up, wrap up. I just wanted to ask about the future and, you know, many times research leads to more research. And I was curious if there are any, unanswered questions or new questions that have cropped up as you've been studying the Earned Income Tax Credit and the Child Tax Credit, anything that you hope to pursue in the future.

 

[KATHERINE MICHELMORE]

 

Yeah, it's a great question. So I think on the Child Tax Credit front, you know, I think prior to the 2021 expansion, there really wasn't a whole lot of work done on it. So, it was nice, I think because of that expansion gave us a nice opportunity to study the impact of the credit. But I think there's still actually a lot we don't know, even though it was a temporary credit. I think first and foremost, you know, going back to kind of my early start in the EITC, is that we don't actually have direct evidence on how it impacted children. You know, other than things like food insecurity, and there's some preliminary evidence on impacts on infant birth weight. But, you know, there's a whole host of kids of outcomes we could study for kids directly that we just don't have evidence on, I think mostly because of lack of data. So I hope to see people kind of explicitly looking at how the CTC in 2021 in particular impacted kids.

 

And I think what was nice about that, this kind of ties to some other, kind of, research conundrums in the EITC is that, I think one thing I've learned about the EITC that's I keep coming back to is, you know, it's really hard to know what it is about the EITC that effect, that is leading to the outcomes that we see, the improvements in kids outcomes. And in particular, I think, you know, in the early research on this, I think we're drawn to trying to point this towards increased income, that it's about like giving kids more money is what leads to better outcomes. I think there's a lot of reason to think that that's true. But the program isn't just about giving families income. It's also like encouraging their parents to go to work. And so I think that like something that's always frustrated me is that it's just really difficult to be able to disentangle, like how much of the effects that we see are coming from, you know, the repercussions of parents going to work versus the income itself, so I think that's just something that's been like really tricky. I mean, that's a very like maybe, a specific topic, but I think it's something that has really broad implications because, you know, like I mentioned earlier, we're talking about work requirements in a whole host of other programs.

 

And one of the primary reasons why the CTC wasn't, the expansion wasn't, extended in 2021 was because of this concern about whether it should have work requirements. So I think we really do need to understand fundamentally, like how much of the benefits we see from these tax credits is about getting more income and how much of it is about labor supply effects. So that is at the top of my list. I don't know how exactly, you know, I think other researchers have tried to get at this a little bit, but I think that's a really fundamental question moving forward. I think the nice thing about the CTC in 2021 was it wasn't tied to work. So that's, I think, again, a nice place to see, what the effects were directly on kids, beause that would give us a better sense of like, you know, if we gave kids more money, like what, what happens to them?

 

So I think that's a big, a big piece that those are kind of two intertwined topics. And then another thing that has always been on my mind, is I'm really interested in this piece, you know, going back to, you know, prepping taxes for people is, you know, people get these, these tax refunds are huge. They get these payments that could be worth up to like almost half of their annual income, in one lump sum when they file their taxes and, you know, thinking about how families spend that kind of money, like that they get all at once versus if they were to get that money over time, like as a monthly payment, I think is really important to understand.

 

So I think it's something that's been nice about the 2021 expansion to the CTC was that half of the credit was, was distributed in monthly increments. So families received monthly benefits between July and December of 2021. And then they got the rest of it as a lump sum when they filed their taxes in 2022. So that gave a nice, nice environment. And I I've seen a couple of papers try to, make something of this, of kind of differentiating how families spent the monthly benefit versus the lump sum. And it's been, you know, this isn’t novel. There's lots of, I think, researchers have thought about this and and what are the tradeoffs of offering benefits on, you know, a more regular interval, say monthly versus annually and other countries structure their benefits differently, too. Most other countries, I think, do distribute benefits a little more frequently.

 

So I think just like having a better understanding of the implications of those, and I don't think the answer is very straightforward because, again, when you talk to people, you know, in qualitative work, when you talk to people, they really like getting lump sum benefits because it's a forced savings mechanism.

It allows families to make like pretty big purchases that they don't wouldn't necessarily be able to make if they were just getting smaller payments throughout the year. But on the other hand, we know that these families are also really credit constrained and, you know, they might be taking on debt every month, to make ends meet, that they might be benefiting from, you know, getting a more regular payment that helps them pay their bills, helps them keep food on the table. So, so that's always been something I, you know, I've dabbled a little bit with in my previous research, but I think, would be interested in, in learning a little bit more about kind of the tradeoffs of, of offering, benefits on a lump sum annual basis versus a monthly, a monthly basis.

 

[J.B. WOGAN]

 

Got it. Katherine, thank you for answering all of my questions and follow-up questions there. I really appreciate talking with you today. And by the way, congratulations on winning the Kershaw award. That’s a prestigious and well-deserved recognition of your scholarship so far.

 

[KATHERINE MICHELMORE]

 

Oh, well, thank you so much. It really was a pleasure to be here and I'm happy to chat. So thank you again.

 

[J.B. WOGAN]

 

Thanks again to our guest, Katherine Michelmore. In the show notes, I’ll include links to papers she discussed on this episode. Long-time listeners may remember our past interviews with the last four winners of the Kershaw Award: Elizabeth Linos, Abigail Aiken, Sanya Carly, and Kirabo Jackson. I’ve created a Kershaw Award playlist on Spotify, so you can hear those earlier interviews, if you’re interested.

 

This episode was produced by my Mathematica colleague, Rich Clement. If you liked this episode, please consider leaving us a rating and review wherever you listen to podcasts. To catch future episodes of the show, subscribe at mathematica.org/ontheevidence.