An Assessment of the Effectiveness of Anti-Poverty Programs in the United States

Abstract

We assess the effectiveness of means-tested and social insurance programs in the United States. We show that per capita expenditures on these programs as a whole have grown over time but expenditures on some programs have declined. The benefit system in the U.S. has a major impact on poverty rates, reducing the percent poor in 2004 from 29 percent to 13.5 percent, estimates which are robust to different measures of the poverty line. We find that, while there are significant behavioral side effects of many programs, their aggregate impact is very small and does not affect the magnitude of the aggregate poverty impact of the system. The system reduces poverty the most for the disabled and the elderly and least for several groups among the non-elderly and non-disabled. Over time, we find that expenditures have shifted toward the disabled and the elderly, and away from those with the lowest incomes and toward those with higher incomes, with the consequence that post-transfer rates of deep poverty for some groups have increased. We conclude that the U.S. benefit system is paternalistic and tilted toward the support of the employed and toward groups with special needs and perceived deservingness.

The Deserving Poor, the Family, and the U.S. Welfare System

“…For this purpose, I draw upon recent work by Ben-Shalom et al (2012) which used the Survey of Income and Program Participation (SIPP) to examine this question. The SIPP is perhaps the best data set for this type of examination, for it is a representative household survey of the U.S. noninstitutional population conducted by the U.S. Bureau of the Census which has as one of its main goals the collection of information on receipt by families of benefits from all major transfer programs, both social insurance and welfare.…”

Work and tax evasion incentive effects of social insurance programs

“…First, it provides an analysis of individuals' reactions to social insurance policies in the labor market beyond the labor supply margin typically studied in the empirical literature (Ben-Shalom, Moffitt and Scholz, 2011). The analysis below also covers the effect of social insurance benefits on the registered/unregistered employment margin of adjustment.…”

Individual & Social Strategies to Mitigate the Risks & Expand Opportunities of an Aging America

“…The Disability Insurance program reduces rates of poverty among the disabled to nearly zero as well. 17 Work by the MacArthur Foundation Research Network on an Aging Society ½nds that public expenditures on Amer icans aged sixty-½ve and older are project ed to rise from $1.2 trillion in 2010 to $4.4 trillion in 2050. Public expenditures on the elderly and disabled, while extremely ef fective in ensuring ½nancial security at old er ages, are not without drawbacks.…”