How Costly is Welfare Stigma? Separating Psychological Costs from Time Costs

Colleen Flaherty Manchester and Kevin Mumford

Purdue University Economics Working Papers from Purdue University, Department of Economics

Abstract: This paper empirically decomposes the costs of welfare participation using a model of labor supply and participation in multiple welfare programs. Prior estimates of the cost of welfare participation have not differentiated psychological costs, or stigma, from the effort required to become eligible and maintain eligibility (time costs). The relative size of these two costs has implications for policy. We find that psychological costs are at least as large as the time costs associated with participation in food assistance programs. In addition, we find that the incidence of psychological costs is inconsistent with these costs acting as an effective screening mechanism.

Keywords: Program Participation; Welfare Stigma; Labor Supply; Structural Estimation (search for similar items in EconPapers)
Pages: 42 pages
Date: 2010-01
New Economics Papers: this item is included in nep-agr
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:pur:prukra:1229

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