The Effects of Hiring Tax Credits on Employment of Disabled Veterans

Abstract

Since the large increase in unemployment brought about by the recession of 2007 2009, policymakers have expressed considerable concern regarding economic problems faced by veterans, particularly those who have been disabled as a result of service during the post-9/11 era. Recently, policymakers from both major parties supported expansions to tax credit programs that reward businesses that offer jobs to unemployed veterans, culminating in the November 2011 passage of the VOW to Hire Heroes Act (Pub. L. 112-56) containing several new credits. This legislation follows in the wake of expansions to the Work Opportunity Tax Credit (WOTC) program enacted in 2007 and 2009 that offered financial incentives to employers who hired certain groups of veterans, including those with service-connected disabilities. Despite the widespread perception among policymakers that tax credits can improve the job prospects of certain segments of the veteran population, including the disabled, there has been little rigorous empirical research establishing whether such tax credits are effective at actually increasing the employment of targeted groups.2 In this paper, I estimate the employment effects of a 2007 WOTC expansion that made tax credits of up to $4,800 available to employers who hired disabled veterans who were recently discharged or unemployed for more than six months. Using a differences-in-differences, triple-differences, and Since the large increase in unemployment brought about by the recession of 2007 2009, policymakers have expressed considerable concern regarding economic problems faced by veterans, particularly those who have been disabled as a result of service during the post-9/11 era. Recently, policymakers from both major parties supported expansions to tax credit programs that reward businesses that offer jobs to unemployed veterans, culminating in the November 2011 passage of the VOW to Hire Heroes Act (Pub. L. 112-56) containing several new credits.

Open PDF

Document Details

Document Type
Technical Report
Publication Date
Jan 01, 2012
Accession Number
ADA585435

Entities

People

  • Paul Heaton

Organizations

  • RAND Corporation

Tags

DTIC Thesaurus Topics

  • Accounting
  • Economic Analysis
  • Employment
  • Equations
  • Food Stamps
  • Governments
  • Health Care
  • Homeland Security
  • Intellectual Property
  • Labor Markets
  • Law
  • National Governments
  • National Security
  • Security
  • Social Security
  • Standards
  • Unified Combatant Commands

Readers

  • Economics
  • Rehabilitation and Prosthetic Care for Military Service Members and Veterans with Limb Loss or Disability.