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How Costly is Welfare Stigma? Separating Psychological Costs from Time Costs


  • Colleen Flaherty Manchester
  • Kevin J. Mumford


This paper empirically decomposes the costs of welfare participation using a model of labor supply and participation in multiple welfare programs. Prior estimates of the cost of welfare participation have not differentiated psychological costs, or stigma, from the effort required to become eligible and maintain eligibility (time costs). The relative size of these two costs has implications for policy. We find that psychological costs are at least as large as the time costs associated with participation in food assistance programs. In addition, we find that the incidence of psychological costs is inconsistent with these costs acting as an effective screening mechanism.

Suggested Citation

  • Colleen Flaherty Manchester & Kevin J. Mumford, 2010. "How Costly is Welfare Stigma? Separating Psychological Costs from Time Costs," Purdue University Economics Working Papers 1229, Purdue University, Department of Economics.
  • Handle: RePEc:pur:prukra:1229

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    Blog mentions

    As found by, the blog aggregator for Economics research:
    1. How big are welfare stigma?
      by Economic Logician in Economic Logic on 2010-09-20 19:51:00
    2. How Costly is Welfare Stigma?
      by Ariel Goldring in Free Market Mojo on 2010-11-23 18:00:42


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    Cited by:

    1. Martie Gillen & Hyungsoo Kim, 2014. "Older Adults’ Receipt of Financial Help: Does Personality Matter?," Journal of Family and Economic Issues, Springer, vol. 35(2), pages 178-189, June.

    More about this item


    Program Participation; Welfare Stigma; Labor Supply; Structural Estimation;

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