A Decade of Welfare Reform: What We've Learned About Welfare Usage and Economic Outcomes
RAND CORP SANTA MONICA CA
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The last decade has seen a number of changes in welfare policy, starting with state waivers under the Aid to Families with Dependent Children program and culminating in the Temporary Assistance for Needy Families TANF block grant implemented by the Personal Responsibility and Work Opportunity Reconciliation Act of 1996. These reforms produced changes in the structure of benefits, introduced time limits, strengthened requirements for mandatory participation in work-related activities, and changed various administrative procedures. What effect have these reforms had on welfare usage and on the key economic outcomes they were intended to impact During the past decade, we have seen some dramatic improvements in these outcomes. As of December 2001, welfare usage has fallen to 2.1 million families, less than half of its all-time peak level in 1994 the fraction of welfare recipients participating in welfare-to-work activities or actually working has increased and for single mothers employment rates, earnings, and incomes have risen while poverty has fallen. However, assuming the reforms caused these improvements ignores other potential causes over the same time period, such as the Earned Income Tax Credit and the robust economy. To get at the actual effect of welfare policies on welfare-related outcomes, RAND Labor and Population program staff have synthesized the current state of knowledge from the growing base of research literature in this area.
- Sociology and Law