Has State Redistribution Policy Grown More Conservative?
AbstractIt is well-known that real benefits in the major cash transfer program in the U.S. -- the Aid to Families with Dependent Children (AFDC) program -- have fallen drastically over the past twenty years. State legislatures, which set AFDC benefit levels, have failed to increase nominal benefits to keep up with inflation, resulting in a 25 percent decline in real benefits between 1960 and 1984. The most popular explanation for this decline is that state legislatures, reflecting the changing preferences of voters, have grown more conservative in their tastes for redistribution. The evidence presented in this paper is consistent instead with a different explanation, that legislatures have let federally-financed Food Stamps displace state-financed AFDC benefits. A similar displacement of AFDC by Medicaid benefits appears to have occurred. Aside from implying that preferences for redistribution have not in fact changed, the results also show that the total transfer benefit has increased, as should be expected from growing income levels. The findings also imply that neither the Food Stamp program nor, presumably, any other lump-sum transfer provided by Congress is likely to have any effect on the incomes of the poor female-head population. Instead, such programs will merely provide budget relief to the states.
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 2516.
Date of creation: Feb 1988
Date of revision:
Publication status: published as National Tax Journal, Vol.43. No.2, pp.123-142, June 1990.
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
Other versions of this item:
- Moffitt, Robert, 1990. "Has State Redistribution Policy Grown More Conservative?," National Tax Journal, National Tax Association, vol. 43(2), pages 123-42, June.
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.:
- Megdal, Sharon Bernstein, 1987. "The Flypaper Effect Revisited: An Econometric Explanation," The Review of Economics and Statistics, MIT Press, vol. 69(2), pages 347-51, May.
- Orr, Larry L, 1976. "Income Transfers as a Public Good: An Application to AFDC," American Economic Review, American Economic Association, American Economic Association, vol. 66(3), pages 359-71, June.
- Hausman, Jerry A, 1985. "The Econometrics of Nonlinear Budget Sets," Econometrica, Econometric Society, Econometric Society, vol. 53(6), pages 1255-82, November.
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page. reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
If references are entirely missing, you can add them using this form.