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Work incentives and the Food Stamp Program

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  • Hoynes, Hilary Williamson
  • Schanzenbach, Diane Whitmore

Abstract

Labor supply theory makes strong predictions about how the introduction or expansion of a social welfare program impacts work effort. Although there is a large literature on the work incentive effects of AFDC and the EITC, relatively little is known about the work incentive effects of the Food Stamp Program and none of the existing literature is based on quasi-experimental methods. We use the cross-county introduction of the program in the 1960s and 1970s to estimate the impact of the program on the extensive and intensive margins of labor supply, earnings, and family cash income. Consistent with theory, we find reductions in employment and hours worked when food stamps are introduced. The reductions are concentrated among families headed by single woman.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Public Economics.

Volume (Year): 96 (2012)
Issue (Month): 1 ()
Pages: 151-162

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Handle: RePEc:eee:pubeco:v:96:y:2012:i:1:p:151-162

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Web page: http://www.elsevier.com/locate/inca/505578

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Keywords: Welfare policy; Labor supply;

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References

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  1. Fraker, Thomas & Moffitt, Robert, 1988. "The effect of food stamps on labor supply : A bivariate selection model," Journal of Public Economics, Elsevier, vol. 35(1), pages 25-56, February.
  2. Moffitt, Robert, 1983. "An Economic Model of Welfare Stigma," American Economic Review, American Economic Association, vol. 73(5), pages 1023-35, December.
  3. G. Burtless & J. A. Hausman, 1977. "The Effect of Taxation on Labor Supply: Evaluating the Gary Negative Income Tax Experiment," Working papers 211, Massachusetts Institute of Technology (MIT), Department of Economics.
  4. Keane, Michael & Moffitt, Robert, 1998. "A Structural Model of Multiple Welfare Program Participation and Labor Supply," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 39(3), pages 553-89, August.
  5. Robert Moffitt, 2002. "Welfare Programs and Labor Supply," NBER Working Papers 9168, National Bureau of Economic Research, Inc.
  6. Moffitt, Robert, 1992. "Incentive Effects of the U.S. Welfare System: A Review," Journal of Economic Literature, American Economic Association, vol. 30(1), pages 1-61, March.
  7. Hoyt Bleakley, 2007. "Disease and Development: Evidence from Hookworm Eradication in the American South," The Quarterly Journal of Economics, MIT Press, vol. 122(1), pages 73-117, 02.
  8. Hilary W. Hoynes & Diane Whitmore Schanzenbach, 2007. "Consumption Reponses to In-Kind Transfers: Evidence from the Introduction of the Food Stamp Program," Working Papers 0711, Harris School of Public Policy Studies, University of Chicago.
  9. Elizabeth Cascio & Nora Gordon & Ethan Lewis & Sarah Reber, 2009. "Paying for Progress: Conditional Grants and the Desegregation of Southern Schools," NBER Working Papers 14869, National Bureau of Economic Research, Inc.
  10. Hilary Hoynes, 1993. "Welfare Transfers in Two-Parent Families: Labor Supply and Welfare Participation Under AFDC-UP," NBER Working Papers 4407, National Bureau of Economic Research, Inc.
  11. Jens Ludwig & Douglas L. Miller, 2005. "Does Head Start Improve Children's Life Chances? Evidence from a Regression Discontinuity Design," NBER Working Papers 11702, National Bureau of Economic Research, Inc.
  12. Finkelstein, Amy & McKnight, Robin, 2008. "What did Medicare do? The initial impact of Medicare on mortality and out of pocket medical spending," Journal of Public Economics, Elsevier, vol. 92(7), pages 1644-1668, July.
  13. Philip K. Robins & Richard W. West, 1980. "Labor Supply Response Over Time," Journal of Human Resources, University of Wisconsin Press, vol. 15(4), pages 524-544.
  14. Hilary Williamson Hoynes & Diane Whitmore Schanzenbach, 2010. "Work Incentives and the Food Stamp Program," NBER Working Papers 16198, National Bureau of Economic Research, Inc.
  15. Paul A. Hagstrom, 1996. "The Food Stamp Participation and Labor Supply of Married Couples: An Empirical Analysis of Joint Decisions," Journal of Human Resources, University of Wisconsin Press, vol. 31(2), pages 383-403.
  16. Janet Currie, 2003. "U.S. Food and Nutrition Programs," NBER Chapters, in: Means-Tested Transfer Programs in the United States, pages 199-290 National Bureau of Economic Research, Inc.
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Citations

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Cited by:
  1. Dague, Laura & DeLeire, Thomas & Leininger, Lindsey, 2014. "The Effect of Public Insurance Coverage for Childless Adults on Labor Supply," IZA Discussion Papers 8187, Institute for the Study of Labor (IZA).
  2. Lentz, Erin C. & Barrett, Christopher B., 2013. "The economics and nutritional impacts of food assistance policies and programs," Food Policy, Elsevier, vol. 42(C), pages 151-163.
  3. Naci Mocan & Christian Raschke & Bulent Unel, 2013. "The Impact of Mothers’ Earnings on Health Inputs and Infant Health," NBER Working Papers 19434, National Bureau of Economic Research, Inc.
  4. Hilary Williamson Hoynes & Diane Whitmore Schanzenbach, 2010. "Work Incentives and the Food Stamp Program," NBER Working Papers 16198, National Bureau of Economic Research, Inc.
  5. Laura Dague & Thomas DeLeire & Lindsey Leininger, 2014. "This study provides plausibly causal estimates of the effect of public insurance coverage on the employment of nonelderly, nondisabled adults without dependent children (“childless adults”). We us," Upjohn Working Papers and Journal Articles 14-213, W.E. Upjohn Institute for Employment Research.
  6. Laura Dague & Thomas DeLeire & Lindsey Leininger, 2014. "The Effect of Public Insurance Coverage for Childless Adults on Labor Supply," NBER Working Papers 20111, National Bureau of Economic Research, Inc.

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