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The Effect of Child Benefits on Financial Difficulties and Spending Habits: Evidence from Poland's Family 500+ Program

Author

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  • Milovanska-Farrington, Stefani

    (University of Tampa)

Abstract

In response to the low fertility rate and high child poverty in Poland, the government implemented the Family 500+ program which provides cash transfers to families with two or more children, and low-income, one-child families. Using a difference-in-differences approach, we explore the causal effect of this policy on expenditure and financial difficulties of beneficiaries relative to non-eligible families. The findings suggest that after the introduction of the program, expenditures on food and cultural activities increased, and the likelihood of experiencing a hardship paying for utilities and medical care declined for the treatment relative to the control group. These results imply a beneficial effect of child benefits on tackling financial difficulties of families with children. From a policy perspective, the findings indicate that cash transfers can alleviate child poverty concerns and financial constraints to having children.

Suggested Citation

  • Milovanska-Farrington, Stefani, 2021. "The Effect of Child Benefits on Financial Difficulties and Spending Habits: Evidence from Poland's Family 500+ Program," IZA Discussion Papers 14274, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp14274
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    Cited by:

    1. Adam Szulc, 2022. "Reconstruction of the Social Cash Transfers System in Poland and Household Well-being: 2015 - 2018 Evidence," KAE Working Papers 2022-076, Warsaw School of Economics, Collegium of Economic Analysis.

    More about this item

    Keywords

    cash benefits; child allowance; expenditures; financial difficulties; poverty;
    All these keywords.

    JEL classification:

    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • D10 - Microeconomics - - Household Behavior - - - General
    • P46 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Consumer Economics; Health; Education and Training; Welfare, Income, Wealth, and Poverty
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth

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