The New Jersey Graduated Work Incentive Experiment

Publisher: Mathematica Policy Research
Jul 30, 1974
Authors
David Kershaw and Felicity Skidmore

Key Findings:

  • There was no widespread withdrawal from work on the part of the experimental group.
  • The experimental group tended to move from public to private rental housing and to buy relatively more homes.
  • Cash assistance did not appear to have an effect on health, self-esteem, social integration, or perceived quality of life.
  • The benefits represented a net increase in family income and allowed greater command over material goods and services, enhancing economic well-being.

The experiment addressed the cost of a nationwide guaranteed annual income determined by the extent to which families would reduce their work effort in response to negative income tax payments. It also sought to provide policymakers with estimates of the administrative costs of this type of program.