Working Paper: NBER ID: w1711
Authors: David T. Ellwood; Lawrence H. Summers
Abstract: This paper reviews the current policies for fighting poverty and explores the impact they have had. We begin by reviewing trends in poverty, poverty spending and economic performance. It is immediately apparent that economic performance is the dominant determinant of the measured poverty rate over the past two decades. Government assistance programs expanded greatly over this period, but the growth in cash assistance was too modest to have major effects, and the large growth in in-kind benefits could not reduce measured poverty since such benefits are not counted as income. Next we focus on three groups: the disabled, female family heads, and unemployed black youth. We find little evidence that government deserves the blame for the problems of each group, and suggest that the broad outlines of current policies are defensible on economic grounds.
Keywords: Poverty; Welfare; Economic Policy; Government Assistance
JEL Codes: I38
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Economic performance (P17) | Poverty rates (I32) |
| Median family income (D31) | Poverty rates (I32) |
| Government assistance programs (I38) | Poverty rates (I32) |
| Disability benefits (H55) | Labor force participation among men (J49) |
| Welfare policies (I38) | Self-sufficiency among the poor (I32) |
| Welfare policies (I38) | Single-parent family formation (J12) |