Are We Understating the Impact of Economic Conditions on Welfare Rolls?
Dan Black (),
Terra McKinnish and
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Seth G.Sanders: Department of Economics, University of Maryland
No 18, Center for Policy Research Policy Briefs from Center for Policy Research, Maxwell School, Syracuse University
In this brief we argue that welfare participation is more sensitive to economic conditions than previously believed. Why? Prior research focused on short-term economic fluctuations and ignored differences between high- and low-skilled workers. As welfare is long-term (i.e., permanent) it makes more sense to make comparisons with long-term economic trends. Also, since low-skilled workers are more likely to end up on welfare, it is proper to focus on their economic opportunities. Thus, we focus on the long-term impact of economic conditions on welfare participation, and we concentrate our analysis on low-skilled workers. Specifically, we analyze long-term changes in the supply of high-paying jobs for coal and steel workers as they affect certain heavy coal- and steel-producing regions of the United States during the 1970s and 1980s. Our findings indicate that welfare participation in these regions closely mirrors the long-term local availability of high-paying jobs for low-skilled workers. This has serious policy implications for the long-term success of welfare reform.
JEL-codes: I38 J31 J65 (search for similar items in EconPapers)
Pages: 26 pages
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Journal Article: Are We Understanding the Impact of Economic Conditions on Welfare Rolls? (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:max:cprpbr:18
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