LABOR-FORCE AND WELFARE PROGRAM PARTICIPATION - THE EFFECTS OF WELFARE

This research examines the quantitative impacts of welfare program cha racteristics and individual characteristics on both the labor force an d welfare participation decisions of low-income females with children. The participation decisions are estimated jointly as a bivariate prob it model using data derived from the U.S. Census Bureau's Current Popu lation Survey for the years 1979 to 1990, inclusive. These data allow the estimation of the precise behavioral impacts of welfare. The main empirical findings are that effective welfare guarantee levels and the effective welfare tax rate on unearned income both significantly affe ct the probability of labor force and welfare program participation, b ut that such impacts are very small in magnitude, Implications for pol icy are discussed.