The Effect of Specific Welfare Policies on Poverty

Abstract

This paper uses monthly SIPP data from 1988 through 2002 and monthly state-level policy data to measure the effects of specific policies on the deep poverty and poverty rates of ever-single mothers and children of ever-single mothers. The 19 specific policies included in the model are grounded in a conceptual framework. More lenient eligibility requirements for welfare receipt and more generous financial incentives to work generally reduce deep poverty, as hypothesized. Welfare time limits are hypothesized to have ambiguous effects on poverty and our results suggest that some stricter time limit policies may decrease deep poverty and poverty rates.