The Child Tax Credit

In this dissertation I examine the Child Tax Credit (CTC), who gets it and who doesn't, paying particular attention to children under the age of three, its legislative and political history, and how it could be improved. At $56.4 billion per year, the Child Tax Credit (CTC) is nearly the largest U.S. federal expenditure on children and families, second only to the Earned Income Tax Credit (EITC), at $59.5 billion (JCT, 2011). Created in 1997, it has been expanded seven times in just the last decade. Yet in spite of America's federal commitment of dollars and legislative commitment of reform, little has been written about the CTC. I examine the literature first to see if cash and cash assistance matter, finding on balance that there is strong evidence that it does, particularly for young children; second to show that the U.S. underinvests in this domain in young children relative both to what is needed and to what other advanced industrialized countries do; and third to lay out the case that changes to the refundable CTC offer one opportunity to address this underinvestment. I examine the legislative history of the CTC, as I believe both the policy analysis and history need to be un