IDEAS home Printed from https://ideas.repec.org/a/kap/reveho/v10y2012i4p541-556.html
   My bibliography  Save this article

The effect of the original introduction of Medicaid on welfare participation and female labor supply

Author

Listed:
  • Sandra Decker
  • Frederic Selck

Abstract

This paper uses the fact that states introduced Medicaid programs at different times between 1966 and 1972 to estimate Medicaid’s effect on Aid to Families with Dependent Children (AFDC) participation. Using state-level data, we find that the introduction of Medicaid accounted for approximately 10% of growth in AFDC caseloads from 1964 to 1974, a time period during which there was thought to be significant unexplained growth in caseloads. Analysis of individual-level data indicates that Medicaid’s effect on AFDC participation occurred through its effect in increasing the number of eligibles who participated in the program, and not because of increases in eligibility or reductions in workforce participation. Copyright Springer Science+Business Media, LLC (outside the USA) 2012

Suggested Citation

  • Sandra Decker & Frederic Selck, 2012. "The effect of the original introduction of Medicaid on welfare participation and female labor supply," Review of Economics of the Household, Springer, vol. 10(4), pages 541-556, December.
  • Handle: RePEc:kap:reveho:v:10:y:2012:i:4:p:541-556
    DOI: 10.1007/s11150-011-9132-7
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s11150-011-9132-7
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: https://libkey.io/10.1007/s11150-011-9132-7?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. John C. Ham & Lara D. Shore-Sheppard, 2005. "Did Expanding Medicaid Affect Welfare Participation?," ILR Review, Cornell University, ILR School, vol. 58(3), pages 452-470, April.
    2. Williamson Hoyne, Hilary, 1997. "Does welfare play any role in female headship decisions?," Journal of Public Economics, Elsevier, vol. 65(2), pages 89-117, August.
    3. Bruce D. Meyer & Dan T. Rosenbaum, 2001. "Welfare, the Earned Income Tax Credit, and the Labor Supply of Single Mothers," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 116(3), pages 1063-1114.
    4. Robert Moffitt, 1994. "Welfare Effects on Female Headship with Area Effects," Journal of Human Resources, University of Wisconsin Press, vol. 29(2), pages 621-636.
    5. Montgomery, Edward & Navin, John C, 2000. "Cross-State Variation in Medicaid Programs and Female Labor Supply," Economic Inquiry, Western Economic Association International, vol. 38(3), pages 402-418, July.
    6. Strumpf, Erin, 2011. "Medicaid's effect on single women's labor supply: Evidence from the introduction of Medicaid," Journal of Health Economics, Elsevier, vol. 30(3), pages 531-548, May.
    7. Moffitt, Robert A., 2002. "Welfare programs and labor supply," Handbook of Public Economics, in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 4, chapter 34, pages 2393-2430, Elsevier.
    8. Sandra Decker, 2000. "Medicaid, AFDC and family formation," Applied Economics, Taylor & Francis Journals, vol. 32(15), pages 1947-1956.
    9. Moffitt, Robert & Wolfe, Barbara L, 1992. "The Effect of the Medicaid Program on Welfare Participation and Labor Supply," The Review of Economics and Statistics, MIT Press, vol. 74(4), pages 615-626, November.
    10. Rebecca M. Blank, 1989. "The Effect of Medical Need and Medicaid on AFDC Participation," Journal of Human Resources, University of Wisconsin Press, vol. 24(1), pages 54-87.
    11. Moffitt, Robert, 1983. "An Economic Model of Welfare Stigma," American Economic Review, American Economic Association, vol. 73(5), pages 1023-1035, December.
    12. Anne E. Winkler, 1991. "The Incentive Effects of Medicaid on Women's Labor Supply," Journal of Human Resources, University of Wisconsin Press, vol. 26(2), pages 308-337.
    13. Aaron S. Yelowitz, 1995. "The Medicaid Notch, Labor Supply, and Welfare Participation: Evidence from Eligibility Expansions," The Quarterly Journal of Economics, Oxford University Press, vol. 110(4), pages 909-939.
    14. Stephen G. Donald & Kevin Lang, 2007. "Inference with Difference-in-Differences and Other Panel Data," The Review of Economics and Statistics, MIT Press, vol. 89(2), pages 221-233, May.
    15. Aaron S. Yelowitz, 1998. "Will Extending Medicaid to Two-Parent Families Encourage Marriage?," Journal of Human Resources, University of Wisconsin Press, vol. 33(4), pages 833-865.
    16. Robert Moffitt, 1987. "Historical Growth in Participation in Aid to Families with Dependent Children: Was There a Structural Shift?," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 9(3), pages 347-363, March.
    17. Moulton, Brent R, 1990. "An Illustration of a Pitfall in Estimating the Effects of Aggregate Variables on Micro Unit," The Review of Economics and Statistics, MIT Press, vol. 72(2), pages 334-338, May.
    18. Moffitt, Robert, 1990. "Has State Redistribution Policy Grown More Conservative?," National Tax Journal, National Tax Association;National Tax Journal, vol. 43(2), pages 123-142, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Bradley Heim & Ithai Lurie & Kosali Simon, 2018. "Did the Affordable Care Act Young Adult Provision Affect Labor Market Outcomes? Analysis Using Tax Data," ILR Review, Cornell University, ILR School, vol. 71(5), pages 1154-1178, October.
    2. Dhaval Dave & Sandra L. Decker & Robert Kaestner & Kosali I. Simon, 2015. "The Effect of Medicaid Expansions in the Late 1980s and Early 1990s on the Labor Supply of Pregnant Women," American Journal of Health Economics, University of Chicago Press, vol. 1(2), pages 165-193, Spring.
    3. Melanie Guldi & Lucie Schmidt, 2017. "Taxes, Transfers, and Women’s Labor Supply in the United States," Working Papers 2017-01, University of Central Florida, Department of Economics.
    4. Bradley Heim & Ithai Lurie & Kosali Simon, 2015. "The Impact of the Affordable Care Act Young Adult Provision on Labor Market Outcomes: Evidence from Tax Data," Tax Policy and the Economy, University of Chicago Press, vol. 29(1), pages 133-157.
    5. Jeehoon Han, 2020. "Snap Expansions And Participation In Government Safety Net Programs," Economic Inquiry, Western Economic Association International, vol. 58(4), pages 1929-1948, October.
    6. Julian Vedeler Johnsen & Kjell Vaage & Alexander Willén, 2022. "Interactions in Public Policies: Spousal Responses and Program Spillovers of Welfare Reforms," The Economic Journal, Royal Economic Society, vol. 132(642), pages 834-864.
    7. Marianne P. Bitler & Madeline Zavodny, 2014. "Medicaid: A Review of the Literature," NBER Working Papers 20169, National Bureau of Economic Research, Inc.
    8. Svetlana Pashchenko & Ponpoje Porapakkarm, 2017. "Work Incentives Of Medicaid Beneficiaries And The Role Of Asset Testing," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 58(4), pages 1117-1154, November.
    9. Ponpoje (Poe) Porapakkarm & Svetlana Pashchenko, 2013. "Labor Supply Incentives of Medicaid," 2013 Meeting Papers 1082, Society for Economic Dynamics.
    10. Hamersma Sarah, 2013. "The Effects of Medicaid Earnings Limits on Earnings Growth among Poor Workers," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 13(2), pages 887-919, August.
    11. Ewing, J. Alexander, 2012. "Labor Force Participation and the Extension of Medicaid by the Forthcoming Affordable Care Act of 2010," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124584, Agricultural and Applied Economics Association.
    12. Boudreaux, Michel & Lipton, Brandy, 2018. "Medicaid Benefit Generosity and Labor Market Outcomes: Evidence from Medicaid Adult Vision Benefits," MPRA Paper 83916, University Library of Munich, Germany.
    13. repec:mrr:papers:wp341 is not listed on IDEAS
    14. Jane G. Gravelle & Sean Lowry, 2016. "The Affordable Care Act, Labor Supply, and Social Welfare," National Tax Journal, National Tax Association;National Tax Journal, vol. 69(4), pages 863-882, December.
    15. R. Vincent Pohl, 2018. "Medicaid And The Labor Supply Of Single Mothers: Implications For Health Care Reform," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 59(3), pages 1283-1313, August.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Boyle, Melissa A. & Lahey, Joanna N., 2016. "Spousal labor market effects from government health insurance: Evidence from a veterans affairs expansion," Journal of Health Economics, Elsevier, vol. 45(C), pages 63-76.
    2. Dhaval Dave & Sandra L. Decker & Robert Kaestner & Kosali I. Simon, 2015. "The Effect of Medicaid Expansions in the Late 1980s and Early 1990s on the Labor Supply of Pregnant Women," American Journal of Health Economics, MIT Press, vol. 1(2), pages 165-193, Spring.
    3. Jonathan Gruber, 2003. "Medicaid," NBER Chapters, in: Means-Tested Transfer Programs in the United States, pages 15-78, National Bureau of Economic Research, Inc.
    4. Marianne P. Bitler & Madeline Zavodny, 2014. "Medicaid: A Review of the Literature," NBER Working Papers 20169, National Bureau of Economic Research, Inc.
    5. John C. Ham & Lara D. Shore-Sheppard, 2005. "Did Expanding Medicaid Affect Welfare Participation?," ILR Review, Cornell University, ILR School, vol. 58(3), pages 452-470, April.
    6. Brigitte C. Madrian, 2005. "The U.S. health care system and labor markets," Conference Series ; [Proceedings], Federal Reserve Bank of Boston, vol. 50(Jun), pages 137-163.
    7. Laura Dague & Thomas DeLeire & Lindsey Leininger, 2017. "The Effect of Public Insurance Coverage for Childless Adults on Labor Supply," American Economic Journal: Economic Policy, American Economic Association, vol. 9(2), pages 124-154, May.
    8. Strumpf, Erin, 2011. "Medicaid's effect on single women's labor supply: Evidence from the introduction of Medicaid," Journal of Health Economics, Elsevier, vol. 30(3), pages 531-548, May.
    9. Gary Painter, 1999. "Low-Income Housing Assistance: Its Impact on Labor Force and Housing Program Participation," Working Paper 8667, USC Lusk Center for Real Estate.
    10. H. W. Hoynes, "undated". "Work, Welfare, and Family Structure: A Review of the Evidence," Institute for Research on Poverty Discussion Papers 1103-96, University of Wisconsin Institute for Research on Poverty.
    11. Thomas Buchmueller & John C. Ham & Lara D. Shore-Sheppard, 2015. "The Medicaid Program," NBER Chapters, in: Economics of Means-Tested Transfer Programs in the United States, Volume 1, pages 21-136, National Bureau of Economic Research, Inc.
    12. R. Vincent Pohl, 2018. "Medicaid And The Labor Supply Of Single Mothers: Implications For Health Care Reform," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 59(3), pages 1283-1313, August.
    13. H. Hoynes & R. Moffitt, "undated". "The effectiveness of financial work incentives in DI and SSI: Lessons from other transfer programs," Institute for Research on Poverty Discussion Papers 1073-95, University of Wisconsin Institute for Research on Poverty.
    14. Yelowitz, Aaron S., 1998. "Why did the SSI-disabled program grow so much? Disentangling the effect of Medicaid," Journal of Health Economics, Elsevier, vol. 17(3), pages 321-349, June.
    15. Boudreaux, Michel & Lipton, Brandy, 2018. "Medicaid Benefit Generosity and Labor Market Outcomes: Evidence from Medicaid Adult Vision Benefits," MPRA Paper 83916, University Library of Munich, Germany.
    16. Zhuan Pei, 2017. "Eligibility Recertification and Dynamic Opt-In Incentives in Income-Tested Social Programs: Evidence from Medicaid/CHIP," American Economic Journal: Economic Policy, American Economic Association, vol. 9(1), pages 241-276, February.
    17. John C. Ham & Lara D. Shore-Sheppard, 2001. "The Impact of Public Health Insurance on Labor Market Transitions," Department of Economics Working Papers 2001-02, Department of Economics, Williams College.
    18. Kumar, Anil, 2020. "Does medicaid generosity affect household income?," Economic Modelling, Elsevier, vol. 92(C), pages 239-256.
    19. Ewing, J. Alexander, 2012. "Labor Force Participation and the Extension of Medicaid by the Forthcoming Affordable Care Act of 2010," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124584, Agricultural and Applied Economics Association.
    20. Aaron S. Yelowitz, 1998. "Will Extending Medicaid to Two-Parent Families Encourage Marriage?," Journal of Human Resources, University of Wisconsin Press, vol. 33(4), pages 833-865.

    More about this item

    Keywords

    Medicaid; Welfare; AFDC; Labor supply;
    All these keywords.

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:reveho:v:10:y:2012:i:4:p:541-556. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.