Economics at your fingertips  

The Decline of Welfare Benefits in the U.S.: The Role of Wage Inequality

Robert Moffitt (), David Ribar () and Mark Wilhelm ()

No 5774, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Welfare benefits in the U.S. have experienced a much-studied secular decline since the mid-1970s. We explore a new hypothesis for this decline related to the increase in wage inequality in the labor market and the decline of real wages at the bottom of the distribution: we posit that voters prefer benefits which are tied to low-skilled wages. We test the hypothesis using a 1969-1992 panel of state-level data. An additional contribution of" our analysis is the use of General Social Survey data on voter preferences for welfare which we combine with Current Population Survey data to determine the voter in each state who has the median preferred welfare benefit level. Our analysis reveals considerable evidence in support of a role for declining real wages in the decline of welfare benefits.

JEL-codes: H72 I38 (search for similar items in EconPapers)
Date: 1996-09
Note: PE
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Published as Journal of Public Economics 68 (1998) 421-452

Downloads: (external link) (application/pdf)

Related works:
Journal Article: The decline of welfare benefits in the U.S.: the role of wage inequality (1998) Downloads
Working Paper: The Decline of Welfare Benefits in the US: The Role of Wage Inequality (1998)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Ordering information: This working paper can be ordered from

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().

Page updated 2020-09-12
Handle: RePEc:nbr:nberwo:5774