Abstract
This paper examines the intergenerational effects of a welfare reform that increased welfare benefits generosity and eased eligibility requirements for single mothers in Israel. Using large-scale restricted administrative data and a difference-in-differences design, I find that the rise in single mothers’ welfare participation rates following the reform had a significant impact on their children’s long-term economic outcomes. Girls exposed to the reform in childhood were likelier to be on welfare themselves as young adults, while boys experienced a long-lasting increase in labor earnings. The results suggest that generous welfare programs can have beneficial consequences for boys growing up in single-parent households.
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