Document Type
Article
Publication Date
5-5-2016
Abstract
In this chapter I discuss the history and basic incentive effects of two key U.S. cash assistance programs aimed at families with children. Starting roughly in the 1980s, critics of the Aid to Families with Dependent Children (AFDC) program argued that the program -- designed largely to cut relatively small checks -- failed to end poverty or promote work. After years of federally provided waivers that allowed states to experiment with changes to their AFDC programs, the critics in 1996 won the outright elimination of AFDC. It was replaced by the Temporary Assistance to Needy Families (TANF) program, over which states have enormous design discretion. In this chapter I argue that the empirical evidence on AFDC’s behavioral impact was never as compelling as AFDC’s critics maintained. Nor, for the period up to about 2012 (the endpoint of this chapter's analysis), is there any substantial empirical evidence supporting what I call the “triumphalist” position that the wave of state and federal welfare reforms that took place in the 1990s importantly explains the observed increase in employment among single mothers. Either the economic boom of the late 1990s, or some other difficult-to-measure change, appears to have played a more important role than welfare reform. What is more, the uncontrolled experimentation of the last two decades has left the U.S. with a crazyquilt collection of state programs that do not lend themselves to the kind of empirical research that would be necessary to benefit from the Brandeisian idea of states as laboratories of democracy.
Keywords
welfare, federalism, cash assistance, AFDC, TANF, PRWORA, welfare reform
Publication Title
The Law and Economics of Federalism
Repository Citation
Gelbach, Jonah B., "Uncontrolled Experiments from the Laboratories of Democracy: Traditional Cash Welfare, Federalism, and Welfare Reform" (2016). All Faculty Scholarship. 1671.
https://scholarship.law.upenn.edu/faculty_scholarship/1671
Included in
Labor and Employment Law Commons, Labor Economics Commons, Law and Economics Commons, Policy History, Theory, and Methods Commons, Political Economy Commons, Politics and Social Change Commons, Public Economics Commons, Public Law and Legal Theory Commons, Public Policy Commons, Social Welfare Commons, Social Welfare Law Commons, State and Local Government Law Commons
Publication Citation
Chapter 5 of The Law and Economics of Federalism, ed. Jonathan Klick, Edward Elgar Publishing Ltd. (2016).