Does Aid to Families with Dependent Children Displace Familial Assistance?

by Robert F. Schoeni

Full Document

FormatFile SizeNotes
PDF file 2.1 MB

Use Adobe Acrobat Reader version 10 or higher for the best experience.

Proponents of reducing welfare assistance argue that the family would respond to the increased need of single mothers by providing more assistance if the state lowered welfare benefits. The objective of this study is to estimate whether income received from AFDC displaces private familial assistance in the form of cash and time help. It is found that displacement is precisely estimated among blacks but not whites. The estimates for blacks suggest that annual familial cash received is reduced by 17 cents per dollar increase in AFDC benefits, and time help received is reduced by 75 hours per year per $1,000 increase in AFDC benefits. As a result, family members who would have given greater amounts of assistance under a less generous welfare program now have greater income themselves, equal to the amount they otherwise would have transferred. Although these may not be the people to whom the program is directly attempting to assist, it is found that they too are quite poor and needy.

This report is part of the RAND Corporation draft series. The unrestricted draft was a product of the RAND Corporation from 1993 to 2003 that represented preliminary or prepublication versions of other more formal RAND products for distribution to appropriate external audiences. The draft could be considered similar to an academic discussion paper. Although unrestricted drafts had been approved for circulation, they were not usually formally edited or peer reviewed.

This research in the public interest was supported by RAND, using discretionary funds made possible by the generosity of RAND's donors, the fees earned on client-funded research, and independent research and development (IR&D) funds provided by the Department of Defense.

Permission is given to duplicate this electronic document for personal use only, as long as it is unaltered and complete. Copies may not be duplicated for commercial purposes. Unauthorized posting of RAND PDFs to a non-RAND Web site is prohibited. RAND PDFs are protected under copyright law. For information on reprint and linking permissions, please visit the RAND Permissions page.

The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.