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TAXES, HEALTH INSURANCE, AND WOMEN'S SELF‐EMPLOYMENT
Author(s) -
VELAMURI MALATHI
Publication year - 2012
Publication title -
contemporary economic policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.454
H-Index - 49
eISSN - 1465-7287
pISSN - 1074-3529
DOI - 10.1111/j.1465-7287.2011.00256.x
Subject(s) - health insurance , subsidy , spouse , demographic economics , natural experiment , sample (material) , self employed , economics , business , labour economics , actuarial science , health care , economic growth , medicine , political science , chemistry , pathology , chromatography , law , market economy
I examine whether the availability of health coverage through the spouse's health plan influences a married woman's decision to become self‐employed. The Tax Reform Act of 1986 (TRA86) introduced a tax subsidy for the self‐employed to purchase their own health insurance. I test whether this “natural” experiment induced more women without spousal health insurance coverage to select into self‐employment. The most conservative difference‐in‐difference estimates based on an analysis of employed women indicate that the incidence of self‐employment among single women rose by 10% in the post‐TRA86 period, while a multinomial specification based on a sample of both employed and nonemployed women suggests that the increase was about 13%. ( JEL J0, J3, I1)