Minimums
Is the Social Safety Net a Long-Term Investment? Large-Scale Evidence from the Food Stamps Program
Martha Bailey et al.
NBER Working Paper, April 2020
Abstract:
We use novel, large-scale data on 43 million Americans from the 2000 Census and the 2001 to 2013 American Communities Survey linked to the Social Security Administration’s NUMIDENT to study how a policy-driven increase in economic resources for families affects children’s long-term outcomes. Using variation from the county-level roll-out of the Food Stamps program between 1961 and 1975, we find that children with access to greater economic resources before age five experience an increase of 6 percent of a standard deviation in their adult human capital, 3 percent of a standard deviation in their adult economic self-sufficiency, 8 percent of a standard deviation in the quality of their adult neighborhoods, 0.4 percentage-point increase in longevity, and a 0.5 percentage-point decrease in likelihood of being incarcerated. Based on these estimates, we conclude that Food Stamps’ transfer of resources to families is a highly cost-effective investment into young children, yielding a marginal value of public funds of approximately 56.
Child Maltreatment, Unemployment, and Safety Nets
Dan Brown & Elisabetta De Cao
London School of Economics Working Paper, January 2020
Abstract:
This paper studies the impact of unemployment on child abuse and neglect between 2004 and 2012 in the United States, by using unique administrative data on every reported incident of child maltreatment made to the state Child Protective Services for nearly every county. We identify the effect of county-level unemployment rates using an industry shift-share instrument which we create by interacting initial county industry shares and national industry unemployment rates. We estimate a large positive effect of unemployment on child neglect. We show that this result captures an impact on the actual incidence of neglect and not reporting behaviour, is not only driven by the manufacturing sector which explains most of the variation in our shift-share instrument, and is robust to alternative instruments. We find indication for a direct income channel: higher unemployment leads to a decrease in real expenditure on basic goods, like food and beverages. We further support this evidence by showing that the effect of unemployment on neglect is significantly smaller in states that introduced longer extensions to the duration of unemployment benefits following the onset of the Great Recession.
The Impact of an Experimental Guaranteed Income on Crime and Violence
David Calnitsky & Pilar Gonalons-Pons
Social Problems, forthcoming
Abstract:
Would unconditional cash payments reduce crime and violence? This paper examines data on crime and violence in the context of an understudied social experiment from the late 1970s called the Manitoba Basic Annual Income Experiment, or Mincome. We combine town-level crime statistics for all medium-sized Canadian Prairie towns with town-level socio-demographic data from the census to study how an experimental guaranteed income affected both violent crime and total crime. We find a significant negative relationship between Mincome and both outcomes. We also decompose total crime and analyze its main components, property crime and “other” crime, and find a significant negative relationship between Mincome and property crime. While the impact on property crime is theoretically straightforward, we close by speculating on the mechanisms that might link the availability of guaranteed annual income payments to a decline in violence, focusing on the mechanisms that shape patterns of inter-partner violence.
Hunger Pains? SNAP Timing and Emergency Room Visits
Chad Cotti, John Gordanier & Orgul Ozturk
Journal of Health Economics, forthcoming
Abstract:
This project uses quasi-random assignment of SNAP receipt dates linked to Medicaid healthcare records to examine whether ER use is affected by the timing of benefits. We find an increase in ER usage at the end of the benefit month, but only among older recipients. The estimated effect is much larger when the end of the benefit cycle coincides with the end of the calendar month, which is when other transfer payments are also depleted. This suggests that within this older group, increased food insecurity leads to increased ER utilization. Further, we find that the share of ER visitors that received SNAP benefits on the day of their ER visit is 3.1% lower than in the SNAP population. This is consistent with benefit receipt altering household behaviors and routines (notably, we observe, by increasing shopping), which may crowd out healthcare utilization. This particular effect is present across all age groups, although the magnitude is smallest for children.
Neighborhood networks and program participation
Daniel Grossman & Umair Khalil
Journal of Health Economics, forthcoming
Abstract:
We investigate whether social interactions among pregnant women can lead to increased Medicaid participation within this population. Using geographically fine vital statistics data, we exploit variation in Medicaid use among recently pregnant mothers, within small neighborhoods, to study the impact on participation among currently pregnant women. Women are more likely to use Medicaid benefits while pregnant including prenatal care, when previously pregnant women on their census block also received similar benefits. Network effects are relatively larger for young first-time mothers as well as for women within neighborhoods with lower initial levels of welfare program knowledge.
Return on Investment From Co-locating Tax Assistance for Low-Income Persons at Clinical Sites
Shinelle Black et al.
Journal of the American Medical Association, 17 March 2020, Pages 1093-1095
Methods: NYC Health + Hospitals partnered with the New York City Department of Consumer and Worker Protection (called the Department of Consumer Affairs at the time of the study) to co-locate free Volunteer Income Tax Assistance–certified services at 4 clinical sites (2 hospitals and 2 outpatient clinics) between January 28 and April 17, 2019. Two community-based organizations (Urban Upbound and Grow Brooklyn) provided tax preparation services using primarily volunteer staff. Some patients were referred to the services by physicians and other clinic staff, while other recipients accessed them through broader publicity efforts such as 311 (New York City’s telephone information line) and the NYC Department of Consumer and Worker Protection website. To assess economic viability of this approach, return on investment (ROI) was calculated using the standard formula: net return (difference between the amount returned to clients and the amount spent) divided by investment cost. In this analysis, the return is financial gain accrued to clients, while cost refers to funds spent by community-based organizations (such as supplies and staff time) and NYC Health + Hospitals (such as capital costs including equipment and space) to run the program. Although tax preparers were volunteers, we calculated cost if paid staff were to be used (assuming an hourly wage of $18.94 [the median wage for tax preparers, according to the US Bureau of Labor Statistics] and a fringe benefit rate of 50%). All tax preparers throughout the 4 NYC Health + Hospitals facilities complied with Section 7216 of the Internal Revenue Service code on reporting tax return information by obtaining client consent to report these results anonymously and in aggregate.
Results: For 2019, 1156 tax returns were filed on behalf of individuals and families at 4 clinical sites. A total of $1 869 917 was returned to clients in federal refunds and credits, with approximately 25% of the dollars returned through EITC refunds. Costs incurred by community-based organizations was $92 687. Volunteers contributed a total of 2668 hours across the 4 sites, including training time. If paid staff were to be used, total costs would increase by $75 798 to $168 485 and aggregate ROI would be 673%.