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Children's Welfare Exposure and Subsequent Development

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  • Phillip B. Levine
  • David J. Zimmerman

Abstract

We examine the extent to which children are exposed to the welfare system through their mother's receipt of benefits and its impact on several developmental outcomes. Using data from the matched mother-child file from the National Longitudinal Survey of Youth (NLSY), we find that children's welfare exposure is substantial. By age 10 over one-third of all children will have lived in a welfare household; black, non-Hispanic children face a much higher rate of exposure. Simple correlations suggest a strong negative relationship between maternal welfare receipt and children's outcomes. In this paper we implement three alternative strategies (instrumental variables, sibling difference, and child fixed effects models) designed to identify whether this correlation can be attributed to the mother's welfare receipt directly or to other characteristics of mothers who receive welfare, regardless of whether or not those characteristics are observable to the researcher. Based on the results of all three estimation strategies, we find little evidence of any causal link between maternal welfare receipt and children's developmental outcomes.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 7522.

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Date of creation: Feb 2000
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Handle: RePEc:nbr:nberwo:7522

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  1. M. Anne Hill & June O'Neill, 1994. "Family Endowments and the Achievement of Young Children with Special Reference to the Underclass," Journal of Human Resources, University of Wisconsin Press, vol. 29(4), pages 1064-1100.
  2. Jonathan Gruber, 1996. "Cash Welfare as a Consumption Smoothing Mechanism for Single Mothers," NBER Working Papers 5738, National Bureau of Economic Research, Inc.
  3. Currie, Janet & Cole, Nancy, 1993. "Welfare and Child Health: The Link between AFDC Participation and Birth Weight," American Economic Review, American Economic Association, vol. 83(4), pages 971-85, September.
  4. Gruber, Jonathan, 2000. "Cash welfare as a consumption smoothing mechanism for divorced mothers," Journal of Public Economics, Elsevier, vol. 75(2), pages 157-182, February.
  5. Janet Currie, 1993. "Welfare and the Well-Being of Children: The Relative Effectiveness of Cash and In-Kind Transfers," NBER Working Papers 4539, National Bureau of Economic Research, Inc.
  6. An, Chong-Bum & Haveman, Robert & Wolfe, Barbara, 1993. "Teen Out-of-Wedlock Births and Welfare Receipt: The Role of Childhood Events and Economic Circumstances," The Review of Economics and Statistics, MIT Press, vol. 75(2), pages 195-208, May.
  7. 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.
  8. Antel, John J, 1992. "The Intergenerational Transfer of Welfare Dependency: Some Statistical Evidence," The Review of Economics and Statistics, MIT Press, vol. 74(3), pages 467-73, August.
  9. P. B. Levine & D. J. Zimmerman, . "The intergenerational correlation in AFDC participation: Welfare trap or poverty trap?," Institute for Research on Poverty Discussion Papers 1100-96, University of Wisconsin Institute for Research on Poverty.
  10. Gottschalk, Peter, 1990. "AFDC Participation across Generations," American Economic Review, American Economic Association, vol. 80(2), pages 367-71, May.
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Cited by:
  1. I. Ku & R. D. Plotnick, . "Do Children from Welfare Families Obtain Less Education?," Institute for Research on Poverty Discussion Papers 1217-00, University of Wisconsin Institute for Research on Poverty.
  2. Cobb-Clark, Deborah A. & Ryan, Chris & Sartbayeva, Anastasia, 2009. "Taking Chances: The Effect of Growing Up on Welfare on the Risky Behavior of Young People," IZA Discussion Papers 4095, Institute for the Study of Labor (IZA).
  3. Chase-Lansdale, P. Lindsay & Cherlin, Andrew J. & Guttmannova, Katarina & Fomby, Paula & Ribar, David C. & Coley, Rebekah Levine, 2011. "Long-term implications of welfare reform for the development of adolescents and young adults," Children and Youth Services Review, Elsevier, vol. 33(5), pages 678-688, May.
  4. Francesconi, Marco & Jenkins, Stephen P. & Siedler, Thomas, 2005. "Childhood family structure and schooling outcomes: evidence for Germany," ISER Working Paper Series 2005-22, Institute for Social and Economic Research.
  5. Juan Baron & Deborah Cobb-Clark & Nisvan Erkal, 2009. "Cultural Transmission of Work-Welfare Attitudes and the Intergenerational Correlation in Welfare Receipt," CEPR Discussion Papers 594, Centre for Economic Policy Research, Research School of Economics, Australian National University.
  6. Eileen Trzcinski & Jerry Brandell, 2002. "Adolescent Outcomes, Poverty Status, and Welfare Reform: An Analysis based on the Survey of Program Dynamics," JCPR Working Papers 269, Northwestern University/University of Chicago Joint Center for Poverty Research.
  7. Quinn Moore & Lucie Schmidt, 2004. "Do Maternal Investments in Human Capital Affect Childrens' Academic Achievement?," Department of Economics Working Papers 2004-13, Department of Economics, Williams College.
  8. Corak, Miles, 2001. "Are the Kids All Right? Intergenerational Mobility and Child Well-being in Canada," Analytical Studies Branch Research Paper Series 2001171e, Statistics Canada, Analytical Studies Branch.
  9. Kelly Balistreri, 2010. "Welfare and the Children of Immigrants: Transmission of Dependence or Investment in the Future?," Population Research and Policy Review, Springer, vol. 29(5), pages 715-743, October.
  10. Louis Kaplow, 2007. "Optimal income transfers," International Tax and Public Finance, Springer, vol. 14(3), pages 295-325, June.
  11. Oscar A. Mitnik, 2007. "Intergenerational transmission of welfare dependency: The effects of length of exposure," Working Papers 0715, University of Miami, Department of Economics.
  12. Corak, Miles, 2001. "Les enfants se portent-ils bien ? Mobilite intergenerationnelle et bien-etre de l'enfant au Canada," Direction des etudes analytiques : documents de recherche 2001171f, Statistics Canada, Direction des etudes analytiques.

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