Reeves, Aaron, Fransham, Mark, Reader, Mary et al. (2 more authors) (2024) Capping welfare payments for workless families increases employment and economic inactivity: evidence from the UK’s benefit cap. International Journal of Social Welfare. ISSN 1468-2397
Abstract
In this paper, we examine the labour market effects of lowering the UK's benefit cap in 2016. This policy limits the total amount a working-age non-disabled household with no-one in employment can receive in social security. We treat the sharp reduction in this benefit cap as a natural experiment, comparing those at risk of being capped and those who were not before and after the cap was lowered. Drawing on data from ~500,000 individuals, we find that this reform reduced unemployment compared to those not at risk of being capped. The reform also increased economic inactivity, partly because the cap harmed mental health but also because those at risk of being capped were eligible to claim disability-related welfare payments that made them exempt. Limiting total monthly welfare payments of low income families may increase employment for some but it can also push others out of the labour market altogether.
Metadata
Item Type: | Article |
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Authors/Creators: |
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Dates: |
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Institution: | The University of York |
Academic Units: | The University of York > Faculty of Social Sciences (York) > Social Policy and Social Work (York) |
Depositing User: | Pure (York) |
Date Deposited: | 31 May 2024 14:00 |
Last Modified: | 16 Oct 2024 19:59 |
Published Version: | https://doi.org/10.1111/ijsw.12651 |
Status: | Published online |
Refereed: | Yes |
Identification Number: | 10.1111/ijsw.12651 |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:213018 |
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Description: Int J Soc Welfare - 2024 - Reeves - Capping welfare payments for workless families increases employment and economic
Licence: CC-BY 2.5