Arbeitspapier

Are lone mothers responsive to policy changes? Evidence from a workfare reform in a generous welfare state

There is a heated debate in many European countries about a move towards a welfare system that increases the incentives for lone mothers to move off welfare and into work. We analyze the consequences of a major Norwegian workfare reform of the generous welfare system for lone mothers. Our difference-in-differences estimates show that the policy changes were successful in improving labor market attachment and increasing disposable income of new lone mothers. By contrast, the reform led to a substantial decrease in disposable income and a significant increase in poverty among persistent lone mothers, because a sizeable group was unable to offset the loss of out-of-work welfare benefits with gains in earnings. This suggests that the desired effects of the workfare reform were associated with the side-effects of income loss and increased poverty among a substantial number of lone mothers with insurmountable employment barriers. This finding stands in stark contrast to evidence from similar policy changes in Canada, the UK, and the US, and underscores that policymakers from other developed countries should be cautious when drawing lessons from the successful welfare reforms implemented in Anglo-Saxon countries.

Sprache
Englisch

Erschienen in
Series: IZA Discussion Papers ; No. 4489

Klassifikation
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
Thema
Lone mothers
workfare reform
difference-in-differences
heterogeneity
earnings
labor force participation
poverty
disposable income
Alleinerziehende
Mütter
Familienpolitik
Aktivierende Sozialhilfe
Wirkungsanalyse
Norwegen

Ereignis
Geistige Schöpfung
(wer)
Mogstad, Magne
Pronzato, Chiara
Ereignis
Veröffentlichung
(wer)
Institute for the Study of Labor (IZA)
(wo)
Bonn
(wann)
2009

Handle
URN
urn:nbn:de:101:1-2009102695
Letzte Aktualisierung
20.09.2024, 08:22 MESZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
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Objekttyp

  • Arbeitspapier

Beteiligte

  • Mogstad, Magne
  • Pronzato, Chiara
  • Institute for the Study of Labor (IZA)

Entstanden

  • 2009

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