This paper examines the effect of cash transfers and food stamp benefits on welfare participation and the labor supply of husbands and wives in two-parent families. The estimates are used to determine the magnitude of the work disincentive effects of the Aid to Families with Dependent Children Unemployed Parent (AFDC-UP) program, and to simulate the effects of changes in AFDC-UP benefit and eligibility rules on family labor supply and welfare participation. The results suggest that labor supply and welfare participation among two-parent families are highly responsive to changes in the benefit structure under the AFDC-UP program. Copyright 1996 by The Econometric Society.
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Article provided by Econometric Society in its journal Econometrica.
Volume (Year): 64 (1996) Issue (Month): 2 (March) Pages: 295-332 Download reference. The following formats are available: HTML
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