The memo:

You are a staff member of the Department of the Treasury, which develops tax policy. The Secretary of

the Treasury has read lots of research indicating that the Earned Income Tax Credit (EITC) , which

generously subsidizes wages of workers in low-income families with children, has spurred many single

mothers to enter the workforce, increasing their employment (and hence their earnings).

The Secretary is also aware that employment rates of low-skilled single men – often without children –

have declined substantially. She is therefore considering proposing that the EITC be expanded to also

generously subsidize wages of those with low incomes who do not have children. She has asked you to write a memo that discusses the potential benefits of this expansion of the EITC

given the problem of low employment of low-skilled males, as well as the potential effects on others

already eligible for a generous EITC. You have been instructed to reach a recommendation to either

leave the EITC as it is currently structured, or to expand its generosity to those without children.

The assignment:

Your memo will be two pages, double-spaced, and will discuss both what economic theory and the

evidence says about the question. As much as possible, back up your arguments with data and evidence.

You will have to do some research, and you will have to boil down a good deal of research into the very

short memo you have to write. The policy memos will be graded on both the content and the quality of

writing. Please do not hand in a memo until it is written well enough that you could imagine submitting it

for your work in a real job.

References to source materials you cite should be listed on additional pages, and do not count toward the

two-page limit. All sources should be cited, and claims about facts or research findings need to have

source materials cited.

You should be looking for materials that describe actual data and real research. You should not be citing

the opinions of others as the basis for the conclusions you draw.