Panel Paper: Welfare Time Limits and Participation

Friday, November 9, 2018
8206 - Lobby Level (Marriott Wardman Park)

*Names in bold indicate Presenter

Gabrielle Pepin, Michigan State University

In 1996, the Personal Responsibility and Work Opportunity Act (PRWORA) established the Temporary Assistance for Needy Families (TANF) program within the United States. TANF, a cash welfare program for low-income families, introduced lifetime time limits for federal welfare dollars. States, however, reserve the right to determine whether and to what extent their TANF recipients are subject to time limits. In recent years, several states imposed TANF time limits for the first time or made existing time limits more stringent. In this paper, I estimate the effects of introducing these time limit policies on reported welfare receipt and the state's number of adult TANF recipients relative to its population. I use time-varying state-level variation in time limit policies to estimate difference-in-differences and synthetic control models of welfare participation. Using both administrative and survey data, I find that the introduction of stricter time limit policies decreases reported welfare participation within the past year by 18-24% and the state's monthly number of adult TANF recipients by 20-69%. Given these large decreases in welfare use, one might expect changes in labor force participation decisions, child outcomes, and participation in other social safety net programs to which eligibility may be linked.

Full Paper: