This paper estimates the effect of Medicaid access on the propensity of households to save or repay debt from their tax refunds. Data come from the tax records and survey responses of households that use an IRS free-file alliance online tax-preparation software to prepare their tax returns during the fiscal years 2013–2017. Findings suggest that expansions to the social safety net may affect the magnitude of the consumption response to tax rebates.
Project: Refund to Savings (R2S)
Citation
Gallagher, E. A., Gopalan, R., Grinstein-Weiss, M., & Sabat, J. (2020). Medicaid and household savings behavior: New evidence from tax refunds. Journal of Financial Economics, 136(2), pp. 523-546.