Welfare Reforms and Consumption among Single Mother Households: Evidence from Canadian Provinces

Abstract

This paper evaluates the impact of the 1995_1998 Ontario welfare reforms on the consumption levels of single mothers. I compare changes in after-tax income and in total expenditure among Ontario single mothers to those among three distinct segments of the Canadian population: single mothers in Quebec and British Columbia, single women with no children in Ontario, and married couples with children in Ontario. The comparison with demographically identical groups under different provincial administrations, and the implementation of propensity score matching of difference-in-difference estimates, sets my approach apart from similar research conducted using US data. The results indicate an initial decrease in the relative consumption levels among Ontario single mothers. This negative policy impact is not present in the long-term results.