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The New Safety Net? Supplemental Security Income after Welfare Reform

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Abstract

Over the past twenty years, the Supplemental Security Income Program (SSI), which provides federally-funded income support for disabled individuals, has become one of the most important means-tested cash aid programs in the United States. This growth has been accompanied by growing concerns about the nature of the program and its role as a “new safety net.” In this paper, I use state panel data, exploiting variation both across states and over time, to examine the relationship between welfare reform and SSI disabled caseloads for both adults and children. I also examine whether the relationship between SSI participation and other factors (economic, health-related, and political) has been fundamentally altered in the aftermath of welfare reform. Results suggest that welfare reform significantly increased SSI participation, and changed the relationship between other conditions and SSI participation. Notably, the SSI program has become more responsive to business cycles for women and children since welfare reform.

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Paper provided by Department of Economics, Williams College in its series Department of Economics Working Papers with number 2013-07.

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Length: 39 pages
Date of creation: Sep 2013
Date of revision:
Handle: RePEc:wil:wileco:2013-07

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  1. Bruce D. Meyer & Wallace K. C. Mok & James X. Sullivan, 2009. "The Under-Reporting of Transfers in Household Surveys: Its Nature and Consequences," Working Papers 0903, Harris School of Public Policy Studies, University of Chicago.
  2. Jonah B. Gelbach & Doug Miller, 2009. "Robust Inference with Multi-way Clustering," Working Papers, University of California, Davis, Department of Economics 99, University of California, Davis, Department of Economics.
  3. Lucie Schmidt & Purvi Sevak, 2000. "AFDC, SSI, and Welfare Reform Aggressiveness: Caseload Reductions vs. Caseload Shifting," Department of Economics Working Papers, Department of Economics, Williams College 2002-03, Department of Economics, Williams College.
  4. John Bound & Richard Burkhauser & Austin Nichols, 2001. "Tracking the Household Income of SSDI and SSI Applicants," Working Papers, University of Michigan, Michigan Retirement Research Center wp009, University of Michigan, Michigan Retirement Research Center.
  5. Norma B. Coe & Kelly Haverstick & Alicia H. Munnell & Anthony Webb, 2011. "What Explains State Variation in SSDI Application Rates?," Working Papers, Center for Retirement Research at Boston College wp2011-23, Center for Retirement Research, revised Nov 2011.
  6. Nicole Maestas & Kathleen Mullen & Alexander Strand, 2012. "Does Disability Insurance Receipt Discourage Work? Using Examiner Assignment to Estimate Causal Effects of SSDI Receipt," Working Papers, University of Michigan, Michigan Retirement Research Center wp241, University of Michigan, Michigan Retirement Research Center.
  7. Nicole Maestas & Kathleen J. Mullen & Alexander Strand, 2013. "Does Disability Insurance Receipt Discourage Work? Using Examiner Assignment to Estimate Causal Effects of SSDI Receipt," American Economic Review, American Economic Association, American Economic Association, vol. 103(5), pages 1797-1829, August.
  8. Subramanian, S. V. & Kawachi, Ichiro & Kennedy, Bruce P., 2001. "Does the state you live in make a difference? Multilevel analysis of self-rated health in the US," Social Science & Medicine, Elsevier, Elsevier, vol. 53(1), pages 9-19, July.
  9. Schoeni, R.F. & Blank, R.M., 2000. "What Has Welfare Reform Accomplished? Impacts on Welfare Participation, Employment, Income, Poverty, and Family Structure," Papers, RAND - Labor and Population Program 00-02, RAND - Labor and Population Program.
  10. Jordan D. Matsudaira & Rebecca M. Blank, 2008. "The Impact of Earnings Disregards on the Behavior of Low Income Families," NBER Working Papers 14038, National Bureau of Economic Research, Inc.
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  12. Marianne P. Bitler & Jonah B. Gelbach & Hilary W. Hoynes, 2006. "Welfare Reform and Children's Living Arrangements," Journal of Human Resources, University of Wisconsin Press, vol. 41(1).
  13. Bowen Garrett & Sherry Glied, 2000. "Does state AFDC generosity affect child SSI participation?," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 19(2), pages 275-295.
  14. Marianne Bitler & Hilary W. Hoynes, 2010. "The State of the Safety Net in the Post-Welfare Reform Era," NBER Working Papers 16504, National Bureau of Economic Research, Inc.
  15. Gruber, Jonathan & Kubik, Jeffrey D., 1997. "Disability insurance rejection rates and the labor supply of older workers," Journal of Public Economics, Elsevier, Elsevier, vol. 64(1), pages 1-23, April.
  16. Jacob Alex Klerman & Steven J. Haider, 2004. "A Stock-Flow Analysis of the Welfare Caseload," Journal of Human Resources, University of Wisconsin Press, vol. 39(4).
  17. Mark G. Duggan & Melissa Schettini Kearney, 2007. "The impact of child SSI enrollment on household outcomes," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 26(4), pages 861-886.
  18. Marianne Bitler & Hilary Hoynes, 2013. "The More Things Change, the More They Stay the Same? The Safety Net and Poverty in the Great Recession," NBER Working Papers 19449, National Bureau of Economic Research, Inc.
  19. Howard P. Marvel, 1982. "An Economic Analysis of the Operation of Social Security Disability Insurance," Journal of Human Resources, University of Wisconsin Press, vol. 17(3), pages 393-412.
  20. David H. Autor & Mark G. Duggan, 2003. "The Rise In The Disability Rolls And The Decline In Unemployment," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 118(1), pages 157-205, February.
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