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Message and price components of Family Caps: Experimental evidence from New Jersey

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  • Jagannathan, Radha
  • Camasso, Michael J.
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    Abstract

    In this paper, we examine the relative efficacy of two mechanisms--price consideration and the message of social responsibility--in accounting for Family Cap effects on fertility behavior. The Family Cap is a component of welfare reform policy that denies additional cash benefits to children born 10 or more months after a woman entered the welfare rolls. We use data from the New Jersey Family Development Program (FDP) evaluation that employed a classical experimental design. We find that fertility behaviors are influenced by both Family Cap price and message mechanisms but that these effects are conditioned by welfare recipients' time on welfare and race. Black women who have longer stays on welfare are more likely to be influenced by price while women with shorter stays are influenced by both price and the social message. We believe our results have implications not only for future public welfare policy initiatives but for any social policies that attempt to influence behavior directly, through individual rewards and punishments, and indirectly through the activation of social or community pressures.

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    Bibliographic Info

    Article provided by Elsevier in its journal Evaluation and Program Planning.

    Volume (Year): 34 (2011)
    Issue (Month): 3 (August)
    Pages: 292-302

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    Handle: RePEc:eee:epplan:v:34:y:2011:i:3:p:292-302

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    Web page: http://www.elsevier.com/locate/evalprogplan

    Related research

    Keywords: Family Cap Social experiment Price effect Message effect IV probit Fertility impacts;

    References

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    1. Thomas J. Nechyba, 1999. "Social Approval, Values, and AFDC: A Re-Examination of the Illegitimacy Debate," NBER Working Papers 7240, National Bureau of Economic Research, Inc.
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    4. Rebecca M. Blank, 2001. "Declining caseloads/increased work: what can we conclude about the effects of welfare reform?," Economic Policy Review, Federal Reserve Bank of New York, issue Sep, pages 25-36.
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    8. Saul D. Hoffman & E. Michael Foster, 2000. "AFDC Benefits and Nonmarital Births to Young Women," Journal of Human Resources, University of Wisconsin Press, vol. 35(2), pages 376-391.
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    13. Joseph Sabia, 2008. "Blacks and the family cap: pregnancy, abortion, and spillovers," Journal of Population Economics, Springer, vol. 21(1), pages 111-134, January.
    14. Robert W. Fairlie & Rebecca A. London, 1997. "The effect of incremental benefit levels on births to AFDC recipients," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 16(4), pages 575-597.
    15. Mark R. Rosenzweig, 1999. "Welfare, Marital Prospects, and Nonmarital Childbearing," Journal of Political Economy, University of Chicago Press, vol. 107(S6), pages S3-S32, December.
    16. Radha Jagannathan & Michael J. Camasso & Mark Killingsworth, 2004. "New Jersey's Family Cap Experiment: Do Fertility Impacts Differ by Racial Density?," Journal of Labor Economics, University of Chicago Press, vol. 22(2), pages 431-460, April.
    17. Brinig, Margaret F & Buckley, F H, 1999. " The Price of Virtue," Public Choice, Springer, vol. 98(1-2), pages 111-29, January.
    18. Lundberg, S. & Plotnick, R.D., 1994. "Adolescent Premarital Childbearing: Do Economic Incentives Matters?," Discussion Papers in Economics at the University of Washington 94-4, Department of Economics at the University of Washington.
    19. Richard Easterlin, 1966. "On the relation of economic factors to recent and projected fertility changes," Demography, Springer, vol. 3(1), pages 131-153, March.
    20. Michael J. Camasso, 2004. "Isolating the Family Cap Effect on Fertility Behavior: Evidence From New Jersey's Family Development Program Experiment," Contemporary Economic Policy, Western Economic Association International, vol. 22(4), pages 453-467, October.
    21. Akerlof, George A & Yellen, Janet L & Katz, Michael L, 1996. "An Analysis of Out-of-Wedlock Childbearing in the United States," The Quarterly Journal of Economics, MIT Press, vol. 111(2), pages 277-317, May.
    22. Williamson Hoyne, Hilary, 1997. "Does welfare play any role in female headship decisions?," Journal of Public Economics, Elsevier, vol. 65(2), pages 89-117, August.
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