Social indicators and the study of inequality

This paper was presented at the conference "Unequal incomes, unequal outcomes? Economic inequality and measures of well-being" as part of session 5, "Social indicators in New York City." The conference was held at the Federal Reserve Bank of New York on May 7, 1999. The authors address some of the challenges faced by economists and others who undertake to measure well-being and inequality and to identify inequality's causes and effects. Their project - the New York City Social Indicators Survey (SIS) - uses social indicators to track economic well-being and inequality. By pushing beyond the limitations of current data sources, SIS will enable the authors to collect the data necessary to define inequality in concrete terms and evaluate whether New York City is becoming more or less unequal. Significantly, it will also shed light on what effect government policies have on inequality's magnitude and consequences.Economic indicators ; Public policy ; Income distribution ; New York (N.Y.)

The Effects of Incarceration on Employment and Wages An Analysis of the Fragile Families Survey

We examine the effects of incarceration on the earnings and employment in a sample of poor fathers, using data from the Fragile Families and Child Wellbeing Study. The Fragile Families data offer a rich set of covariates for adjusting for factors that are correlated with both incarceration and earnings. Because the survey obtains data from male respondents and their female partners, we are also able to measure incarceration more completely than with self-report data alone. Regression and propensity score analysis indicates that the employment rates of formerlyincarcerated men are about 6 percentage points lower than for similar men who have not been incarcerated. Incarceration is associated with a 14 to 26 percent decline in hourly wages. We examine also provide a sensitivity analysis that shows how results might vary in the presence of omitted variables.

Doing More for Our Children: Modeling a Universal Child Allowance or More Generous Child Tax Credit

Child poverty in the United States remains stubbornly high, with 12.2 million children living in poverty in 2013. Nearly 17 percent of children in the United States lived in poverty in 2013 -- a higher rate than for other age groups, and considerably higher than the child poverty rate in other advanced industrialized countries. The U.S. deep child poverty rate -- children who live in families with incomes less than half of the poverty line -- was 4.5 percent of all children in 2013, meaning nearly 1 in 20 children live in families that cannot even afford half of what is considered a minimally adequate living.One key policy for reducing child poverty is the child tax credit (CTC) -- which reduces the child poverty rate from 18.8 percent to 16.5 percent of American children. There is broad acceptance of the importance of the CTC, and key expansions to the CTC were made permanent at the end of 2015. At a moment when leaders ranging from President Barack Obama to Speaker Paul Ryan are talking about poverty, now is an opportune time to explore policy options that would build on this success. This report models two approaches to reduce child poverty in the United States even further -- a universal child allowance and an expanded CTC.A universal child allowance is a cash benefit that is provided to all families with children without regard to their income, earnings, or other qualifying conditions, and that could be subject to taxes for families with high incomes. The U.S. child tax credit, in contrast, is provided only to families that meet a threshold for earnings, phasing in as earnings increase and then phasing out as earnings rise higher. While most other advanced industrialized countries have some kind of universal support for children, the United States does not.For each approach, we begin with a modest reform, and then model increasingly generous versions. In our simulations, we find that even the modest reforms generate important poverty reductions. Our results also make clear that the more we spend on these programs, the greater the reduction in poverty the United States can achieve

Child Support Enforcement and Fathers’ Contributions to Their Nonmarital Children

Research shows that stronger child support enforcement increases the amount of formal support received by children from their nonresident fathers. Yet, little is known about: 1) the informal cash and non-cash contributions that nonresident fathers make—especially to nonmarital children, 2) the effect of child support enforcement on these types of contributions, and 3) most importantly, the effect of child support enforcement on total (formal plus informal) child support contributions. Using data from the Fragile Families and Child Wellbeing Study, we find that strong enforcement reduces the amount of informal support, increases the amount of formal support, and most importantly, has no effect on the total amount of support received by unwed mothers. The effects on total payments are negative for parents who stopped cohabiting recently and positive for parents who never cohabited or stopped cohabiting three or more years ago. Implications for policy hinge upon future research.

The Fragile Families and Child Well-Being Study: Questions, Design, and a Few Preliminary Results

Nonmarital childbearing is important because it is increasing and because there is concern (and some evidence) that it is damaging to children and perhaps parents as well. We refer to the unions of unwed parents as fragile families because they are similar to traditional families in many respects, but more vulnerable. Most people believe that children in fragile families would be better off if their parents lived together and their fathers were more involved in their upbringing. Indeed, public policy is now attempting to enlarge the role of unwed fathers both by cutting public cash support for single mothers and by strengthening paternity establishment and child support enforcement. Yet the scientific basis for these policies is weak. We know very little about the men who father children outside marria ge, and we know even less about the nature of their relationships with their children and their children’s mothers. The Fragile Families and Child Wellbeing Study (FFS) is designed to remedy this situation by following a new birth cohort of approximately 4,700 children, including 3,600 children born to unmarried parents. The new data will be representative of nonmarital births in each of 20 cities and in U.S. cities with populations over 200,000. Both mothers and fathers will be followed for at least 4 years, and inhome assessments of children’s heath and development will be carried out when the child is 4 years old. The survey is designed to address the following questions: (1) What are the conditions and capabilities of new unwed parents, especially fathers? (2) What is the nature of the relationships in fragile families? (3) What factors push new unwed parents together and what factors pull them apart? In particular, how do labor markets, welfare, and child support public policies affect family formation? (4) How do children fare in fragile families and how is their well-being affected by parental capacities and relationships, and by public policies? The paper discusses what we know about each of these questions and how the FFS addresses each of them. It also presents preliminary findings based on data from Austin, Texas, and Oakland, California.

EXPLAINING THE TREND IN TEENAGE BIRTH RATES FROM 1981-1999

We investigate the influence of changes in demography, the strength of the economy, and social policies on teen birth rates in the U.S. from 1981 to 1999, a period of wildly fluctuating rates. We find that demographic and social policy changes largely counteracted one another during this period with the growth in the Hispanic population as the primary factor driving rates up, and the tightening of the Child Support Enforcement program as the primary factor pushing rates down. Our results suggest that if the demographic variables that we measure had remained at their 1981 levels, teens would have had 340,000 (or 3.6 percent) fewer births than were observed over this period. At the same time, if welfare benefits and Child Support Enforcement expenditures had remained at their 1981 levels, teens would have had almost 484,000 (or 5.2 percent) more births than observed. Although related to teen birth rates, the economy does not appear to have played much of a role in the trend in teen birth rates.teenage childbearing, social policy

Child support enforcement and fathers' contributions to their nonmarital children

Research shows that stronger child support enforcement increases the amount of formal support received by children from their nonresident fathers. Yet, little is known about: 1) the informal cash and non-cash contributions that nonresident fathers make—especially to nonmarital children, 2) the effect of child support enforcement on these types of contributions, and 3) most importantly, the effect of child support enforcement on total (formal plus informal) child support contributions. Using data on unmarried parents from the Fragile Families and Child Wellbeing Study, we find that informal payments decline more rapidly than formal payments increase for the first 36 months, after which time this pattern flips. The flip suggests that public enforcement on average has positive effects on payments. States with stronger than average enforcement have larger than average increases in formal support and smaller decreases in informal support, resulting in a statistically insignificant increase in cash support. That the results differ substantially by when parents stopped cohabiting—with negative effects in the short-run and positive effects in the long-run—suggests that stronger child support enforcement may be efficacious in the long run

Wealth and welfare states : what is the real story?

Many believe that the welfare state undermines productivity, economic growth and development; that the United States has an unusually small welfare state; and finally that the United States is and always has been a welfare state laggard. This paper shows that all three propositions are false when one includes education along with cash benefits and health care support as part of the welfare state. We argue that the social programs that constitute the welfare state complement capitalism and enrich nations. The American welfare state is not unusually small, but, it is peculiar in its reliance upon the combination of employer-provided benefits and weak cash benefit programs for the poor. Finally, the United States rather than always being a laggard in welfare state development was a leader in the provision of public education for most of its history, but now lags behind other rich nations

Parental Incarceration and Child Wellbeing: Implications for Urban Families

Using a population-based, longitudinal family survey (N=4,898), we identify a set of economic, residential, and developmental risks particular to the children of incarcerated parents. We use parental reports of incarceration history, demographic background, and a rich set of child and family outcomes, in a series of multivariate regression models. Children of incarerated parents face more economic and residential stability than their counterparts. Children of incarcerated fathers also display more behavior problems, though other developmental differences are insignificant. Several family differences are magnified when both parents have been incarcerated. We find that incarceration identifies families facing severe and unique hardship. Given the prevalence of incarceration, this means a large population of children suffers unmet material needs, residential instability, and behavior problems. These risks may be best addressed by using the point of incarceration as an opportunity for intervention, and the administration of age-appropriate social services.

FRAGILE FAMILIES AND WELFARE REFORM

The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) is designed to shift more of the responsibility for poor children from government to parents. To accomplish this goal, the new law requires welfare clients to work and limits the total number of years they can receive assistance. In addition, the new legislation requires unwed fathers to establish paternity and strengthens child support enforcement among nonresident fathers. Although many people believe that poor children would be better off if their mothers worked and their fathers were more involved in their upbringing, the scientific evidence for these assumptions is weak. We know very little about the ability of poor parents to support their children, and we know even less about their ability to cooperate with one another.