WELFARE AND THE RISE IN FEMALE-HEADED FAMILIES

The article provides a bridge between recent marriage market research and studies of welfare incentive effects on U.S. family formation. Est imates from state and county fixed-effects models indicate significant effects of changing state Aid to Families with Dependent Children, fo od stamps, and Medicaid expenditure levels on county-level changes in families headed by unmarried mothers. However, neither changing welfar e benefit levels nor declining economic and marital opportunities coul d account for recent increases in female headship. The results imply t hat large additional cuts in welfare payment levels would lead to only small reductions in the percentage of female-headed families with chi ldren.