The New Safety Net? Supplemental Security Income after Welfare Reform

Lucie Schmidt

No 2013-07, Department of Economics Working Papers from Department of Economics, Williams College

Abstract: Over the past twenty years, the Supplemental Security Income Program (SSI), which provides federally-funded income support for disabled individuals, has become one of the most important means-tested cash aid programs in the United States. This growth has been accompanied by growing concerns about the nature of the program and its role as a "new safety net." In this paper, I use state panel data, exploiting variation both across states and over time, to examine the relationship between welfare reform and SSI disabled caseloads for both adults and children. I also examine whether the relationship between SSI participation and other factors (economic, health-related, and political) has been fundamentally altered in the aftermath of welfare reform. Results suggest that welfare reform significantly increased SSI participation, and changed the relationship between other conditions and SSI participation. Notably, the SSI program has become more responsive to business cycles for women and children since welfare reform.

Pages: 39 pages
Date: 2013-09
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