Marriage and Economic Incentives: Evidence from a Welfare Experiment
Can economic incentives be used to affect marriage behavior and slow the growth of single-parent families? This paper provides new evidence on the effects of welfare benefit levels on the marital decisions of poor women. Exogenous variation in welfare benefits arises from a randomized experiment carried out in California. Whereas previous studies have measured women's responses to year-to-year changes in welfare benefit changes, I am able to measure responses over longer periods of time. The analysis recognizes that married women can receive AFDC benefits under some circumstances, and distinguishes between transitions into marriage and transitions out of marriage. I find that higher benefits encourage aid recipients who are married to divorce, but have little effect on the probability that single-parent aid recipients marry. The effects on married recipients become larger over time and do not appear to be measuring responses to other, simultaneous changes in California's welfare system. For policy purposes, these results suggest that states can increase the incentive to stay married by increasing two-parent benefits relative to single-parent benefits, an option that only recently became allowed by federal welfare reform.
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|Date of creation:||01 Mar 1999|
|Contact details of provider:|| Postal: Harris Graduate School of Public Policy Studies, 1155 E. 60th Street Chicago, IL 60637|
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- Jeff Grogger & Stephen G. Bronars, 2001. "The Effect of Welfare Payments on the Marriage and Fertility Behavior of Unwed Mothers: Results from a Twins Experiment," Journal of Political Economy, University of Chicago Press, vol. 109(3), pages 529-545, June.
- Jeff Grogger & Stephen G. Bronars, 1997. "The Effect of Welfare Payments on the Marriage and Fertility Behavior of Unwed Mothers: Results from a Twins Experiment," NBER Working Papers 6047, National Bureau of Economic Research, Inc.
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- Strauss, John & Thomas, Duncan, 1995. "Human resources: Empirical modeling of household and family decisions," Handbook of Development Economics,in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 3, chapter 34, pages 1883-2023 Elsevier.
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- T. Paul Schultz, 1990. "Testing the Neoclassical Model of Family Labor Supply and Fertility," Journal of Human Resources, University of Wisconsin Press, vol. 25(4), pages 599-634.
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- McElroy, Marjorie B & Horney, Mary Jean, 1981. "Nash-Bargained Household Decisions: Toward a Generalization of the Theory of Demand," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 22(2), pages 333-349, June. Full references (including those not matched with items on IDEAS)
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