Do Attitudes and Personality Characteristics Affect Socioeconomic Outcomes? The Case of Welfare Use by Young Women

We develop and estimate a model of social-psychological determinants of entry to the Aid to Families with Dependent Children (AFDC) program, the primary cash welfare program in the United States for 60 years until replaced in 1996. The structural model holds that attitudes and personality characteristics influence a woman’s likelihood of becoming demographically and financially eligible for welfare and her willingness to bear the stigma of receiving benefits. These factors, in turn, affect the likelihood of actually going on welfare. We test for a relationship between social-psychological variables and welfare participation using data from the youngest cohorts of women in the National Longitudinal Survey of Youth. We estimate logit models of the probability of ever participating in AFDC up to age 25 and hazard models of the timing until first use of AFDC. The attitudes and personality characteristics in the empirical model are self-esteem, locus of control, attitudes toward school, attitudes toward women’s work and family roles, commitment to work, and aversion to accepting public assistance. We find strong associations between welfare use and several attitudes and personality characteristics, but most of the associations are not robust to the inclusion of exogenous personal and family background characteristics. Consistent, strong evidence suggests that more positive attitudes toward school lower the likelihood of using welfare and increase duration until first receipt.