Volume 12

Spring 2014 Edition


Poverty and the Earned Income Tax Credit

Mindy Ault & Cherrie Bucknor

Using the March 2012 Annual Social and Economic Supplement to the Current Population Survey, we estimated the effect of receiving the Earned Income Tax Credit (EITC) on the after-tax poverty status of low-wage earners. More specifically, we restricted our model to heads of household whose income was below the federal poverty line before taxes in order to determine whether the EITC lifts them out of poverty. Our probit regression models showed that those who received the credit were 53.3 percentage points more likely to be over the poverty line after taxes compared to those who did not receive the credit. Moreover, an additional $100 in the value of the Earned Income Tax Credit increases the likelihood of being over the poverty line after taxes by .94 percentage points.

Influence of Insurance Type on Emergency Department Usage and Costs

LaTiesha Cooper, Carolyn Kraemer, Stephen Schiavone, & Mina Uehara

High health care costs are widely acknowledged as one of the most difficult policy challenges facing America today. For the past several decades, hospital emergency departments (EDs) have become increasingly overcrowded, which is problematic because EDs are often more costly than non-urgent care facilities. Thus, emergency care is a good target for policy interventions to improve efficiency and cut costs without compromising the quality of care. This study contributes to the literature that explores the relationship between ED use and insurance type. We use 2011 data from the Medical Expenditures Panel Survey to consider three outcome variables: individuals’ total 2011 ED costs, average (mean) ED cost per visit in 2011, and number of ED visits in 2011. In addition to our independent variables of interest, private and public insurance, we control for chronic conditions and certain demographic and geographic variables. Using OLS, poisson, and tobit models, we show that Medicaid status is related to a higher likelihood of visiting an emergency department. In keeping with the majority of literature on this subject, we recommend that policymakers explore strategies for reducing ED utilization in favor of more efficient, regular, and possibly preventive care.

The Impact of HIV Testing Policies in State Detention Facilities

Nicolette Davis

Human immunodeficiency virus (HIV) among the incarcerated population highlights the demographic inequities that are prevalent among both the incarcerated and the HIV-affected.  Testing those inmates to reduce risk behaviors and provide highly active antiretroviral linkages is increasingly important as the rate of HIV among the incarcerated rises, though testing policies vary widely.  This paper employs propensity score matching in order to test the effects of different types of testing policies on inmates’ long-term health outcomes.  Policy implications of the findings and recommendations for future research are discussed.

An Examination of Levels of Phosphorus and Nitrogen in the Chesapeake Bay Before and After the Implementation of the Chesapeake 2000 Program

Sam Cramer

Voluntary environmental programs (VEPs) are becoming an integral part of environmental regulation today, but they show mixed results as to whether they can replicate the kinds of successes to which traditional regulatory action can boast. This study looked at one major VEP, the Chesapeake 2000 Program, and its effect on two major pollutants entering the Chesapeake Bay watershed: phosphorus and nitrogen. The study found that while the program did not significantly impact the Bay’s overall health, when impact events like hurricanes were removed from the regression model, the program did significantly lower amounts of phosphorus and nitrogen entering the Bay. This research supports the current literature regarding VEP effects, as well as the types of characteristics that VEPs must have in order to maximize their effectiveness.

Throwing Good Money After Bad? The Effects of Foreign Aid on Income Inequality in Developing Countries

Hanan Abdul Hadi & Kellen Grode

This paper examines the effect of official development aid (ODA) on income inequality in developing countries. Using data from the World Bank’s World Development Indicators, we use a country fixed-effects approach to address endogeneity issues. We find no significant effect of ODA per capita on inequality in developing countries. We therefore conclude that, consistent with previous research in the field, ODA does not significantly contribute to the economic growth and development of developing nations, nor does it appear to decrease income disparity. This analysis adds to the body of literature by using a county fixed-effects approach to analyze the effect of ODA per capita on GINI, something not common in the literature, to obtain our result showing no significant effects.

Reducing Flight Cancellations by Improving Next Generation Air Transportation System Implementation

Carol Foster

In April 2010, the Federal Aviation Administration (FAA) began fining airlines for keeping passengers aboard a grounded plane during lengthy delays. Airlines responded by more frequently canceling their flights to avoid fines. In 2011, the FAA began switching air navigation from radar to global positioning satellite (GPS) technology, known as the Next Generation Air transportation System (NextGen), in order to better accommodate United States (U.S.) air traffic and reduce flight cancellations. However, significant flight cancellation reductions can only occur when NextGen is implemented throughout the U.S. aviation system. While NextGen was originally scheduled to be fully implemented by 2025, delays in the individual airport plan development and in FAA approval of plans mean that the benefits of reduced cancellations may also be postponed.  NextGen rollout can be improved by Congress and the FAA by mandating plan approval timelines, organizing a best practices forum for airports to use when creating individual NextGen plans, and denying federal finding opportunities to airports that do not develop individual plans in a timely manner. Close Congressional and FAA monitoring of these new measures will help to determine whether further policy changes beyond these recommendations will be needed in the future.