Economic Conditions and Welfare Reform by Sheldon Danziger

By Sheldon Danziger

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Greater numbers of recipients have left the rolls than are getting jobs, however. Page 6 In addition, in some states, recipients have been terminated from the rolls because of rule changes, not because they are finding jobs. For example, a report in The New York Times (West Virginia Trims Welfare, but Poor Remain, March 7, 1999) noted that West Virginia had begun to count child Supplemental Security Income (SSI) benefits as income for TANF recipients, rendering them ineligible for TANF benefits regardless of their ability to find work.

Haveman is John Bascom Professor of Economics and Public Affairs at the University of Wisconsin-Madison. Harry J. Holzer is a Professor in the Department of Economics, Michigan State University. Thomas Kaplan is a Senior Scientist with the Institute for Research on Poverty at the University of Wisconsin-Madison. Phillip B. Levine is an Associate Professor in the Department of Economics of Wellesley College. Therese J. McGuire is a Professor with the Institute of Government and Public Affairs and the College of Urban Planning and Public Affairs, University of Illinois at Chicago.

The estimates indicate that the robust economy accounted for 31 percent of the decline, while welfare reform accounted for 16 percent. Recipients versus Caseloads The first step towards reconciling the results from Ziliak et al. with those from the CEA involves the choice of dependent variable. Ziliak et al. used AFDC caseloads per capita as the dependent variable, rather than the number of AFDC recipients. Cases may be preferred to recipients because the latter confounds the number of households receiving AFDC with the within-household fertility behavior.

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