Transfer programs work: evidence from food stamps and mothers pensions

Mother-Child_face_to_face

Source: Wikimedia

Two studies in the latest issue of the American Economic Review analyze the connections between transfers to low-income families and the long-term health and welfare of children in those families.  The conclusions directly contradict the idea that programs such as Aid to Families with Dependent Children and food stamps don’t help those they are intended to aid and lead to general dependency on government programs.

The first article, “Long-Run Impacts of Childhood Access to the Safety Net,” by Hilary Hoynes, Diane Whitmore Schanzenbach, and Douglas Almond, analyzes the effects of the Food Stamp Program (FSP) (now known as the Supplemental Nutrition Assistance Program (SNAP).)  “The FSP was rolled out in a county-by-county basis between 1962 and 1975, providing low-income families with vouchers that could be used at grocery stores to purchase food (p. 904).  Theoretically, the increase in family resources should lead to improvements in child health directly through better nutrition and indirectly by freeing up money in food budgets for spending on health care, education, and other investments in children’s’ wellbeing.

The evidence strongly supports this hypothesis and indicates improvements along two dimensions.

  1. “We find that access to the FSP in utero and in early childhood leads to a large and statistically significant reduction in the incidence of “metabolic syndrome” (a cluster of conditions including obesity, high blood pressure, heart disease, and diabetes) as well as an increase in reporting to be in good health (p. 905).” That is, children whose families received food stamps were healthier than they otherwise would have been.
  2. “We also find for women that access to food stamps in early childhood leads to an increase in economic self-sufficiency (p. 905).” That is, food stamps did not lead to increased dependency on welfare programs but had the opposite effect.

The second article, “The Long-Run Impact of Cash Transfers to Poor Families,” by Anna Aizer, Shari Eli, Joseph Ferrie, and Adriana Lleras-Mune, goes back an earlier program: mothers pensions.  According to Theda Skocpol in Protecting Soldiers and Mothers: The Political Origins of Social Policy in the United States, mothers pensions were “enacted very suddenly by twenty state legislatures in 1911-1913 and by forty states before 1920” and “authorized local governmental authorities to make regular payments directly to impoverished mothers (and occasionally other caretakers) of dependent children (p. 424).”

To examine the effects of this program, Aizer, Eli, Ferrie, and Lleras-Mune studied male children (females changed their names too often to follow them over time) and compared outcomes for families accepted for mothers pensions and those who were rejected.

They found that mothers pensions before 1935 worked like food stamps did after 1961: they increased family resources and improved the lives of children.  In particular, the children in families that received mothers pensions lived longer, obtained more schooling, and had higher lifetime incomes than those whose families did not receive mothers pensions.

One reaction to these results might be, so what?  After all, as Richard V. Reeves put it in a recent opinion piece, “What use is there for policy analysis when it seems as if politicians barely need policies at all?”  Candidates already know what works and what doesn’t, regardless of the evidence, so these kinds of studies won’t make any difference

I remain optimistic that this kind of work can and will make a difference. It’s critical, however, that those of us who keep up on this work churn out three-minute masterpieces and teach those who make policy (and those who advise them) that these kinds of programs work. Otherwise policy will continue to be enacted as much by anecdote and faith as by evidence