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  3. 2024
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  5. Income Support to Families with Children in the U.S.
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Income Support to Families with Children in the U.S.

Paper Session

Friday, Jan. 5, 2024 2:30 PM - 4:30 PM (CST)

Grand Hyatt, Republic B
Hosted By: American Economic Association
  • Chair: Lisa A. Gennetian, Duke University

Income and Child Maltreatment: Evidence from a Discontinuity in Tax Benefits

Katherine Rittenhouse
,
University of Texas-Austin

Abstract

Poverty is one of the leading predictors of child maltreatment, yet the causal relationship is not well understood. In this paper I provide new evidence of the effects of income on child protection system
(CPS) involvement. I exploit a discontinuity in child-related tax benefits around a January 1 birthdate,
which results in otherwise-similar families receiving considerably different refunds during the first year of a child’s life. I use 20 years of linked administrative data from California to determine the effects of this additional income on CPS involvement. A one-time $1,000 transfer to low-income households decreases the number of referrals to CPS in the first 3 years of a child’s life by approximately 3%. These effects persist throughout the system, decreasing investigations (3%), substantiated referrals (4%) and days spent in foster care (8%). Effects also persist throughout childhood, reducing CPS involvement through at least age 8. Heterogeneity analyses by allegation and reporter category as well as by child race and gender suggest that these effects capture true reductions in maltreatment, as opposed to changes in reporting behavior. These findings suggest that providing low-income families with additional resources
during the first year of a child’s life are a fruitful strategy for reducing child maltreatment.

Effects of Universal and Unconditional Cash Transfers on Child Abuse and Neglect

Lindsey Bullinger
,
Georgia Institute of Technology
Analisa Packham
,
Vanderbilt University
Kerri Raissan
,
University of Connecticut

Abstract

We estimate the effects of cash transfers on child well-being. To do so, we leverage program eligibility
due to date of birth cutoffs and year-to-year variation in payment size from a universal and unconditional cash transfer, the Alaska Permanent Fund Dividend (PFD). Using linked individual-level administrative data on PFD payments and child maltreatment referrals, we find that an additional $1,000 to families reduces the likelihood that a child is referred to Children’s Services by age 3 by 2.0 percentage points, or about 10 percent, on average. Effects are driven by declines in neglect and physical abuse. Additionally, we show that larger cash transfers increase the probability that children live with their mothers and lower mortality by age 5.

Does Old Age Social Security Help Children? The Impact of Social Security on Child Well-Being

Lucie Schmidt
,
Smith College
Lara Shore-Sheppard
,
Williams College
Tara Watson
,
Williams College

Abstract

Though Social Security is typically considered a program to support retirees, nearly one in ten children live in a home with Social Security income. Children are substantially more likely to live with an older adult than they were two decades ago and are now twice as likely to be exposed to Social Security income than traditional cash welfare. We use the sharp increase in eligibility for Social Security benefits at age 62 and age patterns in claiming behavior to investigate the role played by the Social Security program in childhood economic outcomes among children who live with older adults. We find that Social Security eligibility and income do not increase household income on average,but are associated with increased availability of household members’ time for home production, as well as reductions in welfare participation for some subsamples. A $10,000 increase in Social Security income is associated with a 0.3-0.4 increase in adults available for home production. We do not see any impact on short-run educational progression, and find some mixed effects on reported cognitive difficulty.

Cash Transfers and Long-Run Child Earnings' Mobility

Emilia Simeonova
,
Johns Hopkins University
Randall Akee
,
University of California-Los Angeles
Maggie R. Jones
,
U.S. Census Bureau

Abstract

We focus on cash transfers received in childhood for American Indian children residing off of American Indian reservation lands. These cash transfers, due to casino operations, were made available to all tribally-enrolled citizens regardless of where they lived. Therefore, we focus on the pure cash transfer effect on a child’s long-run outcomes. Our analysis will compare children of the same birth cohorts who did and did not receive the cash transfers due to their parents’ tribal membership in different tribal nations. We then identify the effect of the cash transfer on adult earnings and employment outcomes.

Unconditional Cash Transfers and Family Investments through Early Childhood in the U.S.: Evidence from a Large-Scale Multi-Site Randomized Control Trial

Lisa A. Gennetian
,
Duke University
Katherine Magnuson
,
University of Wisconsin-Madison
Greg Duncan
,
University of California-Irvine
Kimberly Noble
,
Columbia University
Hirokazu Yoshikawa
,
New York University

Abstract

We provide causal estimates of financial and time investments through the first three years of a child’s life among families living in poverty from a large-scale, multi-site randomized controlled study of monthly unconditional cash transfers starting at the time of a child’s birth. We find that the cash transfers increased spending on child-specific goods and mothers’ early-learning activities, consistently through each of the three years of early childhood. We find no statistically detectable offsets in household earnings nor statistically detectable impacts in other pre-registered outcomes related to general household expenditures, maternal labor supply, time in childcare, or mothers’ subjective well-being. By the third year of follow-up, when the focal children are age 3, families receiving the high-cash transfer appear to be taking on more auto- and housing related debt, though overall debt is lower than families receiving the low-cash transfer; and, mothers have increased educational attainment.

Discussant(s)
Chloe Gibbs
,
University of Notre Dame
JEL Classifications
  • I3 - Welfare, Well-Being, and Poverty
  • H3 - Fiscal Policies and Behavior of Economic Agents