The Impact of Welfare Reform on Living Arrangements

Jonah B. Gelbach, University of Maryland
Hilary W. Hoynes, University of California, Davis

We use data from the March CPS to examine the impacts of 1990s welfare waivers and the 1996 Federal welfare reform on living arrangements in samples of both children and women. Our findings suggest three main conclusions. First, welfare reform has had large effects on some important measures of living arrangements. Second, those effects are neither entirely aligned with the stated goals of reform nor entirely in spite of these goals. For example, TANF was associated with an 11 to 17 percentage point reduction in the fraction of black children living in central cities who live with an unmarried parent. However, the fraction of these children living with neither parent rose by 7 to 12 percentage points, more than doubling the baseline level. Third, there is a great deal of treatment effect heterogeneity. Standard approaches focusing only on dropouts and assuming homogeneous reform effects would generally not uncover these effects.