Tax Credit Payments During the COVID-19 Pandemic: Implications for Family Economic Hardship and Psychological Wellbeing

Session Type: Paper Symposium

Abstract

The COVID-19 pandemic led to extraordinary spikes in economic hardship among low-income families in the US. Perhaps related to these spikes, parents of school-aged children also reported significant increases in psychological distress in the months after the pandemic began. The federal government responded with several measures to supplement family income including an unprecedented expansion of the Child Tax Credit (CTC), delivered for the first time as monthly payments from July to December 2021. Each with longitudinal data spanning pre- and post-CTC time periods, the four papers in this symposium address two crucial questions about the CTC as it relates to child development: 1) Did CTC payments actually relieve families’ economic hardship? 2) Did they also improve parent and child psychological health? Using monthly surveys from service-industry workers in Philadelphia, the first paper finds that parents reported lower food insecurity after CTC payments began but no change in psychological wellbeing. Papers two and three use monthly surveys, one with a national sample of Supplemental Nutrition Assistance Program (SNAP) recipients and another with families from the New York City Early Childhood Poverty Tracker, finding strong effects on economic hardship and small but significant effects on psychological wellbeing. Using daily surveys from a semi-rural sample of families in Pennsylvania, paper four finds that both March 2021 stimulus checks and CTC receipt lowered food insecurity and improved parent and child mood, albeit for different time periods. Collectively, these papers illuminate the benefits and limitations of monthly cash payments and their implications for child development.

Sub Unit

• Social Policy

Chair

• Rebecca Ryan, Georgetown University

Individual Presentations

• Effects of the Pandemic-Era Child Tax Credit on Family Hardship and Children’s Psychological Well-Being - Presenting Author: Anna Gassman-Pines, Duke Univeristy; Elizabeth Oltmans Ananat, Barnard College

• The Effects of the 2021 Child Tax Credit on Anxiety and Depression Among Families with Low Incomes - Presenting Author: Nicole Kovski, University of Washington; Natasha Pilkauskas, University of Michigan - Ann Arbor; Katherine Michelmore, University of Michigan; H. Luke Shaefer, University of Michigan

• The Effects of the CTC on the Wellbeing of New York City Families in Poverty - Sophie Collyer, Columbia University; Presenting Author: Jill Gandhi, Columbia University; Irwin Garfinkel, Columbia University; Jane Waldfogel; Christopher Wimer, Columbia University

• How Did Different Types of Cash Transfers During the COVID-19 Pandemic Relate to Families’ Food Insecurity and Psychological Well-being? Evidence from Daily Surveys - Presenting Author: Samantha Steimle, Georgetown University; Rebecca Ryan, Georgetown University; Caitlin Hines, Georgetown University; Anna Gassman-Pines, Duke Univeristy