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A Policy Model of Multiple Safety Net Program Participation and Labor Supply Author: Oswaldo Urdapilleta Dissertation School: University of North Carolina at Chapel Hill Pages: 253 Publication Date: March 2004 Availability: Access Number: 10789 Abstract: Policymakers have been grappling for decades with the problem of work disincentives and welfare dependence associated with means-tested transfer programs. However, studies on public housing and multiple program participation are inadequate. My dissertation develops a model of the effects of policy alternatives in the context of multiple social programs and local variations. It applies labor economics theory to a rich dataset collected from federal and state governments to forecast individual's transitions towards self-sufficiency. I have completed all the data collection and processing work my research requires. Dissemination of preliminary results has already begun. What remains to be done is the estimation of the econometrical model. This work proceeds in stages from simple to more complex models. I have already completed the simple models. The census of single mothers participating in any of three social safety net programs (public housing, TANF and Food Stamps) from 1995 to 1998 in North Carolina and the rigorous methodology enables me to derive substantive recommendations on individual transition patterns toward self-sufficiency. I will simulate changes in policies to evaluate their effectiveness in facilitating individual progress towards self-sufficiency. In my model, I define a utility function and budget constraint for a utility maximization problem introducing unobserved heterogeneity factors, stochastic shocks, and the external information available to individuals. From the available options, each individual selects the social safety net program participation and employment choice that gives her the highest utility. The longitudinal data permits modeling of quarterly choice set transitions among public assistance programs and progressing out of the public welfare system. I will test alternative policies (for example, changes in earned income disregards, benefit reduction rates, Earned Income Tax Credit) and changes in local conditions to evaluate their effectiveness on moving individuals toward self-sufficiency. The outcomes of interest are the transition patterns toward self-sufficiency for all choice sets under current and alternative policy reforms. This research develops a model, which helps HUD to succeed in promoting self-sufficiency. The model takes into account much of the complexity of the real world in which social policy operates, including the interacting effects of multiple means-tested transfers programs, and the heterogeneity of local conditions and eligible populations. |
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