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Welfare Reform and Changes in the Economic Well-Being of Children

Author

Listed:
  • Neil G. Bennett
  • Hsien-Hen Lu
  • Younghwan Song

Abstract

Since the implementation of the Temporary Assistance for Needy Families program in late-1996, welfare rolls have declined by more than half. This paper explores whether improvements in the economic well-being of children have accompanied this dramatic reduction in welfare participation. Further, we examine the degree to which the success or failure of welfare reform has been shared equally among families of varying educational background. We analyze data from the March Current Population Surveys over the years 1988 through 2001. Specifically, we link data for families with children who are interviewed in adjacent years and determine whether their economic circumstances either improved or deteriorated. We use two alternative approaches to address this general issue: a variety of regression models and a difference-in-differences methodology. These approaches provide consistent answers. In a bivariate framework TANF is associated with higher incomes; but this association becomes insignificant in the presence of business cycle controls. We also determine that children who were poor at an initial time period benefit differently, depending on their parents' educational attainment level. Poor children with parents who do not have a high school degree are significantly worse off in the TANF era, relative to the era prior to welfare reform, than are their more educated counterparts.

Suggested Citation

  • Neil G. Bennett & Hsien-Hen Lu & Younghwan Song, 2002. "Welfare Reform and Changes in the Economic Well-Being of Children," NBER Working Papers 9399, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:9399
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    References listed on IDEAS

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    3. Schoeni, R.F. & Blank, R.M., 2000. "What Has Welfare Reform Accomplished? Impacts on Welfare Participation, Employment, Income, Poverty, and Family Structure," Papers 00-02, RAND - Labor and Population Program.
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    12. Rebecca M. Blank, 2002. "Evaluating Welfare Reform in the United States," Journal of Economic Literature, American Economic Association, vol. 40(4), pages 1105-1166, December.
    13. Juhn, Chinhui & Murphy, Kevin M & Pierce, Brooks, 1993. "Wage Inequality and the Rise in Returns to Skill," Journal of Political Economy, University of Chicago Press, vol. 101(3), pages 410-442, June.
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    Citations

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    Cited by:

    1. Marianne P. Bitler & Jonah B. Gelbach & Hilary W. Hoynes, 2006. "What Mean Impacts Miss: Distributional Effects of Welfare Reform Experiments," American Economic Review, American Economic Association, vol. 96(4), pages 988-1012, September.
    2. Coley, Rebekah Levine & Bachman, Heather J. & Votruba-Drzal, Elizabeth & Lohman, Brenda J. & Li-Grining, Christine P., 2007. "Maternal welfare and employment experiences and adolescent well-being: Do mothers' human capital characteristics matter?," Children and Youth Services Review, Elsevier, vol. 29(2), pages 193-215, February.
    3. Coley, Rebekah Levine & Lohman, Brenda J. & Votruba-Drzal, Elizabeth & Pittman, Laura D. & Chase-Lansdale, P. Lindsay, 2007. "Maternal functioning, time, and money: The world of work and welfare," Children and Youth Services Review, Elsevier, vol. 29(6), pages 721-741, June.
    4. Marianne P. Bitler & Jonah Gelbach & Hilary Hoynes, 2004. "What Mean Impacts Miss Distributional Effects of Welfare Reform Experiments," Working Papers WR-109-NICHD/NIA, RAND Corporation.
    5. Hsien-Hen Lu & Julian Palmer & Younghwan Song & Mary C. Lennon & J. Lawrence Aber, 2004. "Children facing economic hardships in the United States," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 10(11), pages 287-338, June.

    More about this item

    JEL classification:

    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty

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