Dignity in poverty

Kevin Lewis

March 15, 2017

Suicide and the Social Security Early Retirement Age

Jeffrey DeSimone

Contemporary Economic Policy, forthcoming

Using a regression discontinuity framework, this paper documents a previously unnoticed drop of 7%-8% in the U.S. suicide rate upon reaching age 62 during 1990-2014. This decline is concentrated among men, nearly doubled in size over the most recent decade as the income gap between those just older and younger narrowed, and represents the only trend break among ages 45-79. These findings, along with the observed timing of retirement and benefit claims and research on how income affects suicide, suggest that the likely explanation is Social Security early retirement benefit eligibility rather than retirement per se.


Horizontal Immobility: How Narratives of Neighborhood Violence Shape Housing Decisions

Eva Rosen

American Sociological Review, forthcoming

While poor families experience high residential instability, they also stay put for extended periods of time before moving. When they do move, they are likely to move laterally to a similarly disadvantaged place. These two processes - staying in place and churning - amount to "horizontal immobility." Why do people get stuck in disadvantaged environments? Prevailing understandings focus on constraints to residential choice, but even under limitations, families make active residential decisions. Drawing on fieldwork with 50 renters in a low-income, high-crime Baltimore neighborhood, this article proposes that neighborhoods themselves shape narratives governing residential decision-making. In high-crime neighborhoods, renters stay put as long as they can craft a story that justifies remaining. But when the narrative is ruptured by violent events, residents are pushed to action, often a move. The logic behind these moves is motivated by a desire to restore a sense of safety. The concept of "narrative rupture" sheds light on when a family decides to move, representing a mechanism for how residential decisions are shaped by neighborhood forces to reproduce poverty. This concept also contributes to theories of how culture shapes action: we are most likely to act when the narratives supporting our current course of action break down.


Minimum Wages and Consumer Credit: Impacts on Access to Credit and Traditional and High-Cost Borrowing

Lisa Dettling & Joanne Hsu

Federal Reserve Working Paper, January 2017

Proponents of minimum wage legislation point to its potential to raise earnings and lift families out of poverty, while opponents argue that disemployment effects lead to net welfare losses. But these arguments typically ignore the possibility that minimum wage policy has spillover effects on other aspects of households' financial circumstances. This paper examines how state-level minimum wage changes affect the decisions of lenders and low-income borrowers. Using data derived from direct mailings of credit offers, debt recorded in credit reports, and survey-reported usage of alternative credit products, we broadly find that when minimum wages rise, access to credit expands for lower-income households, who in turn, use more traditional credit and less high-cost alternatives. Specifically, for each $1 increase in the minimum wage, lower-income households receive 7 percent more credit card offers, with higher limits and improved terms. Further, there is a drop in usage of high-cost borrowing: payday borrowing falls 40 percent. Finally, we find that borrowers are also better able to manage their debt: delinquency rates fall by 5 percent. Overall, our results suggest that minimum wage policy has positive spillover effects by relaxing borrowing constraints among lower income households.


Minimum Wages and the Distribution of Family Incomes

Arindrajit Dube

University of Massachusetts Working Paper, February 2017

Using the March Current Population Survey data from 1984 to 2013, I provide a comprehensive evaluation of how minimum wage policies influence the distribution of family incomes. I find robust evidence that higher minimum wages shift down the cumulative distribution of family incomes at the bottom, reducing the share of non-elderly individuals with incomes below 50, 75, 100, and 125 percent of the federal poverty threshold. The long run (3 or more years) minimum wage elasticity of the non-elderly poverty rate with respect to the minimum wage ranges between -0.22 and -0.55 across alternative specifications that subsume most of the approaches used in the literature to construct valid counterfactuals. Inverting the policy's effect on the cumulative distribution, I estimate minimum wage elasticities for unconditional quantiles of family incomes. The long run minimum wage elasticities for the 10th and 15th unconditional quantiles of equivalized family incomes range between 0.15 and 0.49 depending on specification. A reduction in public assistance partly offsets these income gains, which are on average 72% as large when using an expanded income definition including tax credits and non-cash transfers.


Moving Up Matters: Socioeconomic Mobility Prospectively Predicts Better Physical Health

Jenny Cundiff et al.

Health Psychology, forthcoming

Objective: Low socioeconomic status (SES) in childhood confers risk for poor physical health later in life. This study prospectively examines whether improvements in family SES protect youth from developing physical health problems by adulthood and whether such effects differ by race or age.

Method: Participants are a school-based sample of urban Black (53%) and White (47%) men (N = 311). Using latent growth curve modeling, we prospectively examined whether changes in family SES measured annually between Ages 7 and 16 predicted physical health diagnoses in adulthood (Age 32). Family SES was assessed as a weighted composite of parental education and occupational status. Physical health diagnoses were assessed as a count of self-reported medical conditions from a health history interview.

Results: Consistent with macroeconomic trends, on average, family SES increased until the early 1990s, then remained flat until rising again in the mid-1990s. During each of 3 independent developmental periods, boys raised in families who experienced more positive changes in SES reported fewer physical health diagnoses in adulthood. These effects did not vary significantly by race and remained after controlling for initial childhood SES, childhood health problems, concurrent adult SES, and weight (Body Mass Index or reported overweight).

Conclusions: Initial childhood SES did not predict physical health, whereas relative improvements in SES over a 10-year period did. If the families of Black and White boys were upwardly mobile, it appeared to protect them from developing physical disease, and upward mobility was additively protective across developmental periods examined here.


The impact of welfare reform on the health insurance coverage, utilization and health of low education single mothers

Kimberly Narain et al.

Social Science & Medicine, forthcoming

The Personal Responsibility Work Opportunity and Reconciliation Act (PRWORA) of 1996 imposed time limits on the receipt of welfare cash benefits and mandated cash benefit sanctions for failure to meet work requirements. Many studies examining the health implications of PRWORA have found associated declines in health insurance coverage and healthcare utilization among single mothers but no impact of PRWORA on health outcomes. A limitation of this literature is that most studies cover a time period before time limits were implemented in all states and also before individuals began actually timing out. This work builds on previous studies by exploring this research question using data from the Survey of Income and Program Participation that covers a time period after all states have implemented time limits (1991-2009). We use a difference-in-differences study design that exploits variability in eligibility for cash welfare benefits by marital status and state-level variation in timing of PRWORA implementation to identify the effect of PRWORA. Using ordinary least square regression models, controlling for state-level and federal policies, individual-level demographics and state and year fixed-effects, we find that PRWORA leads to 7 and 5 percentage point increases in self-reported poor health and self-reported disability among white single mothers without a diploma, respectively.


Young child poverty in the United States: Analyzing trends in poverty and the role of anti-poverty programs using the Supplemental Poverty Measure

Jessica Pac et al.

Children and Youth Services Review, March 2017, Pages 35-49

Between 1968 and 2013, the poverty rate of young children age 0 to 5 years fell by nearly one third, in large part because of the role played by anti-poverty programs. However, young children in the U.S. still face a much higher rate of poverty than do older children in the U.S. They also continue to have a much higher poverty rate than do young children in other developed countries around the world. In this paper, we provide a detailed analysis of trends in poverty and the role of anti-poverty programs in addressing poverty among young children, using an improved measure of poverty, the Supplemental Poverty Measure. We examine changes over time and the current status, both for young children overall and for key subgroups (by child age, and by child race/ethnicity). Our findings can be summarized in three key points. First, poverty among all young children age 0-5 years has fallen since the beginning of our time series; but absent the safety net, today's poverty rate among young children would be identical to or higher than it was in 1968. Second, the safety net plays an increasing role in reducing the poverty of young children, especially among Black non-Hispanic children, whose poverty rate would otherwise be 20.8 percentage points higher in 2013. Third, the composition of support has changed from virtually all cash transfers in 1968, to about one third each of cash, credit and in-kind transfers today.


How Are SNAP Benefits Spent? Evidence from a Retail Panel

Justine Hastings & Jesse Shapiro

NBER Working Paper, January 2017

We use a novel retail panel with more than six years of detailed transaction records to study the effect of participation in the Supplemental Nutrition Assistance Program (SNAP) on household spending. We frame our approach using novel administrative data from the state of Rhode Island. The marginal propensity to consume SNAP-eligible food (MPCF) out of SNAP benefits is 0.5 to 0.6. The MPCF out of cash is much smaller. These patterns obtain even for households for whom SNAP benefits are economically equivalent to cash in the sense that benefits do not cover all food spending. We reject the hypothesis that households respect the fungibility of money in a semiparametric setup. A post-hoc model of mental accounting rationalizes these facts and others.


Displaced in Place: Manufactured Housing, Mass Eviction, and the Paradox of State Intervention

Esther Sullivan

American Sociological Review, forthcoming

This article examines housing insecurity within manufactured housing-the single largest source of unsubsidized affordable housing in the United States, home to about 18 million low-income residents. A large portion of manufactured housing is installed in mobile home parks, which can legally close at any time, displacing entire communities. Based on two years living within and being evicted from closing mobile home parks in two states, this comparative ethnography of mass eviction juxtaposes sites of distinctive state practices for managing the forced relocation of park residents. I analyze the experience of eviction in Florida, a site of explicit intervention and "model" legislation for mobile home park closures, in light of the experience in Texas, where the state has adopted a hands-off approach. I describe the paradoxical effects of Florida's protective, yet market-oriented, state housing interventions, which produced both a cottage industry of mobile home relocation services and a more protracted, pernicious eviction for displaced residents. I outline the specific mechanisms through which this paradox of state intervention occurred and consider the implications not only for mobile home parks but also for a variety of other state programs that are currently being delivered through an adaptive reliance on the private sector.


Longitudinal trends in substance use and mental health service needs in child welfare

Orion Mowbray et al.

Children and Youth Services Review, February 2017, Pages 1-8

Caregiver substance use and mental health problems have long been discussed as concerns in promoting positive child welfare outcomes. Yet the absence of longitudinal data focused on racial/ethnic differences in service needs and substance use has limited child welfare systems in their ability to address potential disparities. This study examines racial/ethnic trends in service needs and patterns of substances used among child welfare-involved caregivers over a 15-year period (2000-2015) from a large, urban county located in the Midwestern United States. Substance use service needs showed an increase over time among White non-Hispanic individuals, and declined over time for all racial/ethnic minority groups. Mental health service needs increased over time, with White non-Hispanic individuals experiencing the largest increase. Co-occurring service needs showed a moderate increase for all groups. Trends associated with service needs across the lifespan were relatively similar across racial and ethnic groups, with needs peaking between ages 30 and 35. When examining specific substances used, cocaine use decreased over time for all individuals. However, marijuana use increased substantially for Black/African American individuals, while opioid use increased substantially for White non-Hispanic individuals. These results highlight key areas where trends among child welfare-involved caregivers differ from population-based trends and suggest that improved coordination between child welfare agencies, mental health and substance use treatment providers may be a key step in reducing the disparities observed.

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