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

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  • 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
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    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.
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    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.
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    Cited by:

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    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.

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    Keywords

    Medicaid; Welfare; AFDC; Labor supply;
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