Arbeitspapier

Are Lone Mothers Responsive to Policy Changes? The Effects of a Norwegian Workfare Reform on Earnings, Education, and Poverty

The generous Nordic model of welfare is commonly viewed as an exceptional success both in terms of equality and economic growth. However, it has recently become evident that subgroups of the population with weak labour market attachment and high welfare dependency, such as lone mothers, were vastly overrepresented among the poor. This motivated a workfare reform of the Norwegian welfare system for lone mothers; activity requirements were introduced, time limits imposed, and benefit levels raised. To evaluate the welfare reform we introduce an estimator that, unlike the much used difference-in-difference approach, accounts for the fact that policy changes are typically phased in gradually rather than coming into full effect at once. We find that the workfare reform did not only increase earnings and education as well as lower welfare caseloads and by this route ease the financial burden of the government, but also reduced poverty.

Language
Englisch

Bibliographic citation
Series: Discussion Papers ; No. 533

Classification
Wirtschaft
Single Equation Models; Single Variables: Panel Data Models; Spatio-temporal Models
Measurement and Analysis of Poverty
Welfare, Well-Being, and Poverty: Government Programs; Provision and Effects of Welfare Programs
Labor and Demographic Economics: General
Subject
Welfare reform
lone mothers
difference-in-difference
workfare
activity requirements
time limits
earnings
education
poverty

Event
Geistige Schöpfung
(who)
Pronzato, Chiara
Mogstad, Magne
Event
Veröffentlichung
(who)
Statistics Norway, Research Department
(where)
Oslo
(when)
2008

Handle
Last update
10.03.2025, 11:42 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Pronzato, Chiara
  • Mogstad, Magne
  • Statistics Norway, Research Department

Time of origin

  • 2008

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