Welfare Reform in California: Early Results from the Impact Analysis

By Jacob Alex Klerman; V. Joseph Hotz et al. | Go to book overview

D
Results of the Policy Simulation
Conducted on Participation Rates

As noted in Section 2, changes to the benefit structure affect employment among current recipients and participation rates in two different ways. First, there is a behavioral effect: Because a recipient would take home more of her earnings, she works more. Second, there is a mechanical effect. A higher earned-income disregard and a lower BRR imply that a recipient remains eligible for cash assistance at a higher level of total earnings. Under the benefit structure in California, a woman with two children must work full time at about $8.75 an hour to be income-ineligible for CalWORKs. In many other states, full-time or even half-time work at the minimum wage makes a family income-ineligible for cash assistance. Thus, recipients who in another state would be income-ineligible remain eligible for, and often remain on, welfare in California.

Using the Q5 data, we can simulate the magnitude of the effect of benefit structure on the participation rate. Our analysis focuses on those working sufficient hours to be income-ineligible in other states (half-time to full-time at the federal minimum wage, $5.15 per hour). Because they are working more than 25 hours per week, they appear in both the numerator and the denominator of the federal participation rate in California, raising the rate over what it would be in a state with a lower level of maximum earnings. We tabulate the fraction of California welfare cases with earnings high enough to make them incomeineligible in other states. Assuming that every such person was participating according to the federal definition, we can compute the effect on the participation rate.

Table D.1 presents the results of such a simulation. It gives the percentage drop in the caseload that would occur if California adopted the benefit structure of each state (the benefit structures are described in Choesni et al., 2000), as well as the effect on the participation rate.1

This simple simulation ignores the behavioral response to the benefit structure. We can use conventional labor-supply models and estimates to make a rough

____________________
1
The effect on the participation rate is computed as P* = (Pf)/(1 – f), where P is the baseline participation rate, f is the fraction of the caseload that would be income-ineligible in the other state, and P* is the implied participation rate given the other state's benefit structure.

-100-

Notes for this page

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this book

This book has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this book

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this page

Cited page

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited page

Bookmark this page
Welfare Reform in California: Early Results from the Impact Analysis
Table of contents

Table of contents

  • Title Page *
  • Preface iii
  • Contents v
  • Figures vii
  • Tables ix
  • Summary xi
  • Acknowledgments xix
  • Acronyms and Abbreviations xxi
  • 1 - Introduction 1
  • 2 - Program Participation 14
  • 3 - The Caseload 31
  • 4 - Outcomes for Leavers 56
  • 5 - Conclusions and Next Steps 76
  • Appendix 81
  • A. Overview of Factors That Might Affect Outcomes *
  • B - Data Sources 92
  • C - Analytic Methods 96
  • D. Results of the Policy Simulation Conducted on Participation Rates 100
  • E. Caseload Decline by California Region and County 103
  • Bibliography 105
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this book

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen
/ 122

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.