What Mean Impacts Miss: Distributional Effects of Welfare Reform Experiments

49 Pages Posted: 8 Sep 2005

See all articles by Marianne P. Bitler

Marianne P. Bitler

University of California, Davis - Departments of Economics and Agricultural Resource Economics; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Jonah B. Gelbach

University of California, Berkeley - School of Law

Hilary Williamson Hoynes

University of California, Berkeley; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Multiple version iconThere are 2 versions of this paper

Date Written: August 2005

Abstract

Labor supply theory predicts systematic heterogeneity in the impact of recent welfare reforms on earnings, transfers, and income. Yet most welfare reform research focuses on mean impacts. We investigate the importance of heterogeneity using random-assignment data from Connecticut's Jobs First waiver, which features key elements of post-1996 welfare programs. Estimated quantile treatment effects exhibit the substantial heterogeneity predicted by labor supply theory. Thus mean impacts miss a great deal. Looking separately at samples of dropouts and other women does not improve the performance of mean impacts. We conclude that welfare reform's effects are likely both more varied and more extensive than has been recognized.

Keywords: treatment effect heterogeneity, welfare reform, distributional effects

JEL Classification: J2, I38, H53

Suggested Citation

Bitler, Marianne P. and Gelbach, Jonah B. and Hoynes, Hilary Williamson, What Mean Impacts Miss: Distributional Effects of Welfare Reform Experiments (August 2005). IZA Discussion Paper No. 1728, Available at SSRN: https://ssrn.com/abstract=799865

Marianne P. Bitler

University of California, Davis - Departments of Economics and Agricultural Resource Economics ( email )

United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Jonah B. Gelbach

University of California, Berkeley - School of Law ( email )

215 Boalt Hall
Berkeley, CA 94720-7200
United States

Hilary Williamson Hoynes (Contact Author)

University of California, Berkeley ( email )

310 Barrows Hall
Berkeley, CA 94720
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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