Welfare, the Family, and Reproductive Behavior Research Perspectives (1998) / Chapter Skim
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7 The Effect of Welfare on Child Outcomes
7 The Effect of Welfare on Child Outcomes
Pages 177-204
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From page 177... ...
; the Earned Income Tax Credit (EITC) ; housing assistance; Food Stamps; the Supplemental Feeding Program for Women, Infants, and Children (WIC)
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From page 178... ...
Nevertheless, not all programs are equally effective, and benefits are not equally distributed across children. Hence, a review of what we know about these programs can provide a useful starting point for welfare reform, as well as highlighting gaps in what we need to know in order to carry out intelligent reform.
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From page 179... ...
For example, they may lack motivation or be discouraged by previous misfortune. Failure to properly control for these differences could lead one to incorrectly infer that it was being on welfare that was associated with negative child outcomes, rather than these underlying conditions.
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From page 180... ...
For example, a researcher interested in the effects of participation in Medicaid on child health might argue that the generosity of state AFDC benefits is associated with participation in Medicaid because of the link between AFDC recipiency and Medicaid eligibility, but that the level of AFDC benefits does not have any effect on child health other than through its effect on participation in Medicaid. If this assumption were true, then the level of AFDC benefits would qualify as an "instrumental variable." This instrument would be used (along with other observable characteristics of the mother)
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From page 181... ...
TANF differs from AFDC because it ends the "entitlement" of all needy families to welfare benefits, because it introduces time limits on welfare benefits and because it provides states with much more latitude in developing their own welfare programs. Nevertheless, since most of what we know about cash welfare programs comes from studies of AFDC, and because many states will respond to TANF by only gradually altering their AFDC programs, it is of interest to summarize this literature here.
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From page 182... ...
They use both sibling comparisons and instrumental variables methods to take account of unobserved variables that might be correlated with both participation in the AFDC program and outcomes,] and find that AFDC participation has no additional significant effect on birthweight given income.
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From page 183... ...
Since NIT participants were randomly assigned to "treatment" and "control" groups, the NIT experiments provide a unique opportunity to assess the effects of income transfers per se on the well-being of children in poor families. Despite the large transfers, findings about the effects of the NIT are inconsistent across studies and experimental populations.
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From page 184... ...
For example, the NIT appears to have had a negative effect on the labor supply of married women,3 and positive effects on housing expenditures and purchases of consumer durables (Robins, 1985; Michael, 1978~.4 WHAT WE KNOW ABOUT IN-KIND PROGRAMS A parallel "in-kind" welfare system has grown up alongside the cash system. This system aims to directly provide for a child's "basic needs": decent housing, food, medical care, and quality early education.
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From page 185... ...
For example, we can ask whether receipt of housing assistance is associated with improvements in housing or whether household participation in the Food Stamps program improves a child' s diet. We might then wish to ask whether the program has additional effects on related child outcomes.
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From page 186... ...
lived in housing with severe or moderate physical problems compared to 7 percent of nonpoor households.7 It is not known whether, in general, housing assistance enables families in deficient housing to move to adequate housing. A 1988 HUD study found that more than half of public housing households lived in projects that needed moderate to substantial rehabilitation just to meet HUD's own standards.
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From page 187... ...
On the other hand, they suggest that the disamenities associated with large public housing projects may have significant negative effects. However, the study is marred by high rates of attrition from the sample.
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From page 188... ...
They find significant positive effects on all three outcomes. The Food Stamp Program Food Stamps are issued in the form of booklets of coupons that may be used to purchase all foods except alcohol, tobacco, and hot foods "intended for immediate consumption." In contrast to AFDC, Food Stamps are available to all families who meet federally determined income-eligibility requirements, though AFDC recipients are automatically eligible.
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From page 189... ...
If WIC participants are worse off than nonparticipants because places are scarce and onlY the neediest are admitted into the program, then studies that compare 1lSome circumstantial evidence pertinent to this hypothesis comes from the Washington State Welfare Reform Demonstration Program. AFDC recipients in demonstration counties had the option of choosing to receive their AFDC and Food Stamp benefits in the form of a single consolidated check rather than continuing to receive Food Stamp coupons.
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From page 190... ...
School lunches are provided free to children with family incomes less than 130 percent of the federal poverty line and are subsidized if the family income falls between 130 and 185 percent of the poverty line. In 1990, lunches were served to approximately 12.8 million students, and 10.3 million students received free lunches.
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From page 191... ...
States are now required to cover all pregnant women and children under 6 with family incomes less than 133 percent of the federal poverty line, regardless of family structure.~4 Beginning on July 1,1991, states have been required to cover all children born after September 30, 1983, whose family incomes are less than 100 percent of the federal poverty line. The recent 1997 Budget Reconciliation Act allocates $47 billion over the next 10 years to allow states to expand health insurance coverage to an even larger group of uninsured children, either through the Medicaid program or through separate state initiatives.
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From page 192... ...
look at the effect of becoming eligible for Medicaid on the utilization of medical care and on child health. The effects of Medicaid eligibility are identified using the recent federally mandated expansions of the Medicaid program to pregnant women and children described above.
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From page 193... ...
The fraction of children with private health insurance fell over the period of the Medicaid expansions to such an extent that there was actually a small decrease in the fraction of children with any health insurance coverage. These trends lead one to suspect that public health insurance may have "crowded out" private insurance coverage.
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From page 194... ...
Specifically, the initial positive effects of the Head Start program may be undermined if Head Start children were subsequently exposed to inferior schools. And since we see fadeout for blacks but not for whites, it would have to be the case that black Head Start children are attending worse schools than other black children but that the same was not true among whites.
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From page 195... ...
If a "quality" school is defined as one in which children do well, then these results suggests that black children who attend Head Start go on to attend schools of significantly worse quality than other black children. In contrast, among nonHispanic white children there appears to be little difference in the schools attended by Head Start and other children.
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196 4= so _4 o 8 ~ V)
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From page 197... ...
A second problem is that large-scale, individual-level datasets typically lack information about neighborhoods and administrative procedures that could be used to test specific hypotheses about group differences. For example, one might believe that black children on Medicaid receive fewer visits for illness than white
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From page 198... ...
As of 1990, half of AFDC children received free school lunches, 35 percent lived in public or subsidized rental housing, and 19 percent participated in WIC. Conversely, half of all Food Stamp recipients, 42 percent of Medicaid recipients, 38 percent of WIC recipients, and 24 percent of those in public housing also received AFDC.
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From page 199... ...
Data limitations place severe restrictions on our ability to look inside the "black box" of welfare programs. For example, we can show that expansions in Medicaid eligibility have been related to reductions in child mortality rates at the state level, but we do not know why.
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From page 200... ...
Ruggles 1996 When do women use AFDC and food stamps? The dynamics of eligibility vs.
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1975. Food Stamps and Nutrition.
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From page 202... ...
1990a The Effects of Food Stamps on Food Consumption: A Review of the Literature. Washington, D.C.: USDA Food and Nutrition Service.
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From page 203... ...
: 1-61. 1989 Estimating the value of an in-kind transfer: The case of food stamps.
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From page 204... ...
1988. Robins, Philip 1985 A comparison of the labor supply findings from the four negative income tax exper meets.
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