IDEAS home Printed from https://ideas.repec.org/a/ebl/ecbull/eb-08i30020.html
   My bibliography  Save this article

Are Welfare Eligible Households Forward Looking?

Author

Listed:
  • Hal Snarr

    (North Carolina A & T State University)

  • Dan Axelsen

    (PricewaterhouseCoopers LLP)

Abstract

A consensus has formed in the welfare reform literature suggesting that welfare eligible households (WEH) “bank” benefits in the presence of time limits, either by delaying enrollment in welfare or exiting well before the time limit is reached. In this study, we use the standard labor-leisure lifetime utility to analyze the behavioral effects of imposing time limits on welfare use. Our approach is different from our predecessors (which model welfare participation) in that we model delayed enrollment in and early exit from welfare. Our results suggest that prior to time limits, WEH enroll in welfare as soon as eligibility is established and remain on assistance programs until their youngest children reach adulthood. Moreover, time limits do not alter this behavior in WEH with older children. As such, being “forward looking” in an era of time limits is not a sufficient condition for banking welfare benefits.

Suggested Citation

  • Hal Snarr & Dan Axelsen, 2008. "Are Welfare Eligible Households Forward Looking?," Economics Bulletin, AccessEcon, vol. 9(8), pages 1-9.
    • Handle: RePEc:ebl:ecbull:eb-08i30020
    as

    Download full text from publisher

    File URL: http://www.accessecon.com/pubs/EB/2008/Volume9/EB-08I30020A.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Jeffrey Grogger, 2004. "Time Limits and Welfare Use," Journal of Human Resources, University of Wisconsin Press, vol. 39(2).
    2. Sheng Cheng Hu, 1978. "On the Dynamic Behaviour of the Consumer and the Optimal Provision of Social Security," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 45(3), pages 437-445.
    3. Jeffrey Grogger & Charles Michalopoulos, 2003. "Welfare Dynamics under Time Limits," Journal of Political Economy, University of Chicago Press, vol. 111(3), pages 530-554, June.
    4. Jeffrey Grogger, 2003. "The Effects of Time Limits, the EITC, and Other Policy Changes on Welfare Use, Work, and Income among Female-Headed Families," The Review of Economics and Statistics, MIT Press, vol. 85(2), pages 394-408, May.
    5. Jeffrey Grogger, 2004. "Welfare transitions in the 1990s: The economy, welfare policy, and the EITC," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 23(4), pages 671-695.
    6. Neeraj Kaushal & Robert Kaestner, 2001. "From Welfare to Work: Has Welfare Reform Worked?," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 20(4), pages 699-719.
    7. Christopher A. Swann, 2005. "Welfare Reform When Recipients Are Forward-Looking," Journal of Human Resources, University of Wisconsin Press, vol. 40(1).
    8. Unknown, 2005. "Forward," 2005 Conference: Slovenia in the EU - Challenges for Agriculture, Food Science and Rural Affairs, November 10-11, 2005, Moravske Toplice, Slovenia 183804, Slovenian Association of Agricultural Economists (DAES).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. repec:ebl:ecbull:v:9:y:2008:i:8:p:1-9 is not listed on IDEAS
    2. Snarr, Hal W. & Burkey, Mark L., 2006. "A Preliminary Investigation of Welfare Migration Induced by Time Limits," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 36(2), pages 1-16.
    3. 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.
    4. Gabrielle Pepin, 2022. "The effects of welfare time limits on access to financial resources: Evidence from the 2010s," Southern Economic Journal, John Wiley & Sons, vol. 88(4), pages 1343-1372, April.
    5. Jeounghee Kim, 2010. "Welfare-to-Work Programs and the Dynamics of TANF Use," Journal of Family and Economic Issues, Springer, vol. 31(2), pages 198-211, June.
    6. Mazzolari, Francesca & Ragusa, Giuseppe, 2012. "Time Limits: The Effects on Welfare Use and Other Consumption-Smoothing Mechanisms," IZA Discussion Papers 6993, Institute of Labor Economics (IZA).
    7. Julia Shu-Huah Wang, 2021. "State TANF Time Limit and Work Sanction Stringencies and Long-Term Trajectories of Welfare Use, Labor Supply, and Income," Journal of Family and Economic Issues, Springer, vol. 42(4), pages 650-696, December.
    8. Melanie Guldi & Lucie Schmidt, 2017. "Taxes, Transfers, and Women’s Labor Supply in the United States," Working Papers 2017-01, University of Central Florida, Department of Economics.
    9. Wolfgang Ochel, 2004. "Welfare Time Limits in the United States – Experiences with a New Welfare-to-Work Approach," CESifo Working Paper Series 1210, CESifo.
    10. Badi H. Baltagi & Yin‐Fang Yen, 2016. "Welfare Reform and Children's Health," Health Economics, John Wiley & Sons, Ltd., vol. 25(3), pages 277-291, March.
    11. Marc K Chan, 2014. "Measuring the Dynamic Effects of Welfare Time Limits," Working Paper Series 23, Economics Discipline Group, UTS Business School, University of Technology, Sydney.
    12. Bastian, Jacob E. & Jones, Maggie R., 2021. "Do EITC expansions pay for themselves? Effects on tax revenue and government transfers," Journal of Public Economics, Elsevier, vol. 196(C).
    13. Hamish Low & Costas Meghir & Luigi Pistaferri & Alessandra Voena, 2018. "Marriage, Labor Supply and the Dynamics of the Social Safety Net," NBER Working Papers 24356, National Bureau of Economic Research, Inc.
    14. Berg, Nathan & Gabel, Todd, 2010. "New Reform Strategies and Welfare Participation in Canada," MPRA Paper 26591, University Library of Munich, Germany.
    15. Jiyoon Kim, 2018. "The Timing Of Exemptions From Welfare Work Requirements And Its Effects On Mothers' Work And Welfare Receipt Around Childbirth," Economic Inquiry, Western Economic Association International, vol. 56(1), pages 317-342, January.
    16. Nathan Berg & Todd Gabel, 2015. "Did Canadian welfare reform work? The effects of new reform strategies on social assistance participation," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 48(2), pages 494-528, May.
    17. Hau Chyi, 2013. "The 1993 EITC Expansion and Low-Skilled Single Mothers’Welfare Use Decision," Working Papers 2013-10-14, Wang Yanan Institute for Studies in Economics (WISE), Xiamen University.
    18. Marc K. Chan, 2017. "Welfare Dependence and Self-Control: An Empirical Analysis," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 84(4), pages 1379-1423.
    19. Nathan Berg & Todd Gabel, 2013. "Effects of New Welfare Reform Strategies on Welfare Participation: Microdata Estimates from Canada," Working Papers 1304, University of Otago, Department of Economics, revised Feb 2013.
    20. Hau Chyi, 2012. "The 1993 EITC expansion and low-skilled single mothers’ welfare use decision," Applied Economics, Taylor & Francis Journals, vol. 44(13), pages 1717-1736, May.
    21. Pronzato, Chiara & Mogstad, Magne, 2008. "Are lone mothers responsive to policy changes? The effects of a Norwegian workfare reform on earnings, education and poverty," ISER Working Paper Series 2008-15, Institute for Social and Economic Research.

    More about this item

    JEL classification:

    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty
    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ebl:ecbull:eb-08i30020. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: John P. Conley (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.