Politics, Relief, and Reform: The Transformation of America's Social Welfare System during the New Deal
AbstractThe American social welfare system was transformed during the 1930s. Prior to the New Deal public relief was administered almost exclusively by local governments. The administration of local public relief was widely thought to be corrupt. Beginning in 1933, federal, state, and local governments cooperatively built a larger social welfare system. While the majority of the funds for relief spending came from the federal government, the majority of administrative decisions were made at state and local levels. While New Dealers were often accused of playing politics with relief, social welfare system created by the New Deal (still largely in place today) is more often maligned for being bureaucratic than for being corrupt. We do not believe that New Dealers were motivated by altruistic motives when they shaped New Deal relief policies. Evidence suggests that politics was always the key issue. But we show how the interaction of political interests at the federal, state, and local levels of government created political incentives for the national relief administration to curb corruption by actors at the state and local level. This led to different patterns of relief spending when programs were controlled by national, rather than state and local officials. In the permanent social welfare system created by the Social Security Act, the national government pressed for the substitution of rules rather than discretion in the administration of relief. This, ultimately, significantly reduced the level of corruption in the administration of welfare programs.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 11080.
Date of creation: Jan 2005
Date of revision:
Note: DAE PE
Contact details of provider:
Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.
Web page: http://www.nber.org
More information through EDIRC
Find related papers by JEL classification:
- N3 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy
- N4 - Economic History - - Government, War, Law, International Relations, and Regulation
- H0 - Public Economics - - General
- H1 - Public Economics - - Structure and Scope of Government
- H4 - Public Economics - - Publicly Provided Goods
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-02-01 (All new papers)
- NEP-PBE-2005-02-01 (Public Economics)
- NEP-PKE-2005-02-01 (Post Keynesian Economics)
- NEP-POL-2005-02-01 (Positive Political Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Wallis, John Joseph, 1989. "Employment in the Great Depression: New data and hypotheses," Explorations in Economic History, Elsevier, vol. 26(1), pages 45-72, January.
- Fleck, Robert K, 1999. "The Value of the Vote: A Model and Test of the Effects of Turnout on Distributive Policy," Economic Inquiry, Western Economic Association International, vol. 37(4), pages 609-23, October.
- Wallis, John, 2001. "The Political Economy of New Deal Spending, Yet Again: A Reply to Fleck," Explorations in Economic History, Elsevier, vol. 38(2), pages 305-314, April.
- Reading, Don C., 1973. "New Deal Activity and the States, 1933 to 1939," The Journal of Economic History, Cambridge University Press, vol. 33(04), pages 792-810, December.
- Marilyn Young & Michael Reksulak & William F. Shughart, 2001. "The Political Economy of the IRS," Economics and Politics, Wiley Blackwell, vol. 13(2), pages 201-220, 07.
- Price V. Fishback & Shawn Kantor & John Joseph Wallis, 2002.
"Can the New Deal's Three R's Be Rehabilitated? A Program-by-Program, County-by-County Analysis,"
NBER Working Papers
8903, National Bureau of Economic Research, Inc.
- Fishback, Price V. & Kantor, Shawn & Wallis, John Joseph, 2003. "Can the New Deal's three Rs be rehabilitated? A program-by-program, county-by-county analysis," Explorations in Economic History, Elsevier, vol. 40(3), pages 278-307, July.
- Wallis, John Joseph, 1987. "Employment, Politics, and Economic Recovery during the Great Depression," The Review of Economics and Statistics, MIT Press, vol. 69(3), pages 516-20, August.
- Wallis, John Joseph, 1991. "The Political Economy of New Deal Fiscal Federalism," Economic Inquiry, Western Economic Association International, vol. 29(3), pages 510-24, July.
- Fleck, Robert K., 2001. "Population, Land, Economic Conditions, and the Allocation of New Deal Spending," Explorations in Economic History, Elsevier, vol. 38(2), pages 296-304, April.
- Wright, Gavin, 1974. "The Political Economy of New Deal Spending: An Econometric Analysis," The Review of Economics and Statistics, MIT Press, vol. 56(1), pages 30-38, February.
- John J. Wallis & Wallace Oates, 1998. "The Impact of the New Deal on American Federalism," NBER Chapters, in: The Defining Moment: The Great Depression and the American Economy in the Twentieth Century, pages 155-180 National Bureau of Economic Research, Inc.
- Jonathan Gruber & Daniel M. Hungerman, 2005.
"Faith-Based Charity and Crowd Out during the Great Depression,"
NBER Working Papers
11332, National Bureau of Economic Research, Inc.
- Gruber, Jonathan & Hungerman, Daniel M., 2007. "Faith-based charity and crowd-out during the great depression," Journal of Public Economics, Elsevier, vol. 91(5-6), pages 1043-1069, June.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().
If references are entirely missing, you can add them using this form.