Canada has a universal social assistance program that is almost comple
tely administered through the federal Canada Assistance Program. Howev
er, provinces determine the levels of assistance for various groups el
igible for welfare. This article exploits the variation in payments an
d uses microdata to estimate the effect of changes in welfare benefits
on welfare participation, single parenthood, births out of wedlock, d
ivorce, and labor force participation among low-income women. In Canad
a, it would appear that welfare benefits influence these decisions.