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Drug Use and AFDC Participation: Is There a Connection?


  • Robert Kaestner


Drug use and welfare are two serious social problems that have received widespread public attention. Recently, it has been suggested that illicit drug use is a major cause of welfare, although there is only anecdotal evidence to support such a claim. This paper provides the first systematic analysis of the issue by examining the relationship between illicit drug use and welfare participation among a nationally representative sample of young adults. The results indicate that past year drug use, predominantly marijuana use, is positively related to future welfare participation for both non-black and black women. The magnitude of the drug effect, however, is modest: if drug use among welfare participants was reduced to the levels of non-participants, welfare participation would decline by approximately one percent.

Suggested Citation

  • Robert Kaestner, 1996. "Drug Use and AFDC Participation: Is There a Connection?," NBER Working Papers 5555, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:5555
    Note: HE

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    References listed on IDEAS

    1. 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.
    2. Robert Kaestner, 1994. "The Effect of Illicit Drug Use on the Labor Supply of Young Adults," Journal of Human Resources, University of Wisconsin Press, vol. 29(1), pages 126-155.
    3. Barbara Mensch & Denise Kandel, 1992. "Drug use as a risk factor for premarital teen pregnancy and abortion in a National Sample of Young White Women," Demography, Springer;Population Association of America (PAA), vol. 29(3), pages 409-429, August.
    4. Gail Mitchell Hoyt & Frank J. Chaloupka, 1994. "Effect Of Survey Conditions On Self-Reported Substance Use," Contemporary Economic Policy, Western Economic Association International, vol. 12(3), pages 109-121, July.
    5. Robert Kaestner, 1995. "The Effects of Cocaine and Marijuana Use on Marriage and Marital Stability," NBER Working Papers 5038, National Bureau of Economic Research, Inc.
    6. Moffitt, Robert, 1983. "An Economic Model of Welfare Stigma," American Economic Review, American Economic Association, vol. 73(5), pages 1023-1035, December.
    7. Andrew M. Gill & Robert J. Michaels, 1992. "Does Drug Use Lower Wages?," ILR Review, Cornell University, ILR School, vol. 45(3), pages 419-434, April.
    8. Charles A. Register & Donald R. Williams, 1992. "Labor Market Effects of Marijuana and Cocaine Use among Young Men," ILR Review, Cornell University, ILR School, vol. 45(3), pages 435-448, April.
    9. Robert Kaestner, 1994. "New Estimates of the Effect of Marijuana and Cocaine Use on Wages," ILR Review, Cornell University, ILR School, vol. 47(3), pages 454-470, April.
    10. Kaestner, Robert, 1991. "The Effect of Illicit Drug Use on the Wages of Young Adults," Journal of Labor Economics, University of Chicago Press, vol. 9(4), pages 381-412, October.
    11. Blank, Rebecca M., 1989. "Analyzing the length of welfare spells," Journal of Public Economics, Elsevier, vol. 39(3), pages 245-273, August.
    12. Robert Kaestner, 1998. "Drug Use, Culture, and Welfare Incentives: Correlates of Family Structure and Out-of-Wedlock Birth," Eastern Economic Journal, Eastern Economic Association, vol. 24(4), pages 395-416, Fall.
    13. Stigler, George J & Becker, Gary S, 1977. "De Gustibus Non Est Disputandum," American Economic Review, American Economic Association, vol. 67(2), pages 76-90, March.
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    Cited by:

    1. Hope Corman & Dhaval M. Dave & Dhiman Das & Nancy E. Reichman, 2013. "Effects Of Welfare Reform On Illicit Drug Use Of Adult Women," Economic Inquiry, Western Economic Association International, vol. 51(1), pages 653-674, January.
    2. Robert Kaestner, 1999. "Does Drug Use Cause Poverty?," NBER Chapters,in: The Economic Analysis of Substance Use and Abuse: An Integration of Econometrics and Behavioral Economic Research, pages 327-368 National Bureau of Economic Research, Inc.
    3. Beau Kilmer & Rosalie Liccardo Pacula, 2010. "Preventing Drug Use," NBER Chapters,in: Targeting Investments in Children: Fighting Poverty When Resources are Limited, pages 181-220 National Bureau of Economic Research, Inc.

    More about this item

    JEL classification:

    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health


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