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Unintended Consequences of Welfare Cuts on Children and Adolescents

Author

Listed:
  • Christian Dustmann
  • Rasmus Landersø
  • Lars Højsgaard Andersen

Abstract

This paper studies the effects of a large welfare benefit reduction on the children in the affected families. The welfare cut targeted adult refugees who received residency in Denmark, and it reduced their disposable income by 30 percent on average over the first five years. We show that children exposed to the welfare cut during preschool and school-age obtained lower GPAs, experienced reduced well-being and overall education levels, and suffered lower employment and earnings as adults. Children in their teens at exposure faced large increases in conviction probabilities for violent and property crimes.

Suggested Citation

  • Christian Dustmann & Rasmus Landersø & Lars Højsgaard Andersen, 2024. "Unintended Consequences of Welfare Cuts on Children and Adolescents," American Economic Journal: Applied Economics, American Economic Association, vol. 16(4), pages 161-185, October.
    • Handle: RePEc:aea:aejapp:v:16:y:2024:i:4:p:161-85
    DOI: 10.1257/app.20230519
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    Cited by:

    1. Carmen Villa, 2024. "The effects of youth clubs on education and crime," IFS Working Papers W24/51, Institute for Fiscal Studies.

    More about this item

    JEL classification:

    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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