The labor supply effect of in-kind transfers

We estimate a model of labor supply and participation in multiple programs for UK lone
mothers which exploits a reform of in-work transfers. Cash entitlements increased but
eligibility to in-kind child nutrition programs was lost. We find that in-work cash and inwork
in-kind transfers both have large positive labor supply effects. There is, however, a
utility loss from program participation which is estimated to be larger for cash than for
child nutrition. This implies that the partial cash out of the in-kind benefits reduced labor
supply.