Abstract
This study evaluates the potential effectiveness of alternative child support policies in reducing welfare program participation. Employing longitudinal data from the Panel Study of Income Dynamics, the analysis addresses the simultaneity of women's decisions regarding welfare participation, labor force participation, and annual hours of work following marital breakup. The estimation framework accounts for the endogeneity of child support payments with female labor supply and for the selection bias due to differential rates of remarriage among divorced/separated women. Results show that higher child support payments would (i) decrease welfare participation and (ii) increase average hours of work. The empirical estimates are used to assess the potential effects of adopting alternative child support policies such as the Wisconsin child support assurance system. These results suggest that large potential welfare cost savings are attainable but significant reductions in welfare participation rates would only be achieved through substantial improvements in child support enforcement or through government-assured child support payments.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
