Research

New Deal, Same Compromise:   Measuring the Effect of Racially Linked Welfare Policies on Program Participation and Children's Development

 

Abstract:

This paper studies the implementation and nullification of man-in-the-house (MITH) rules that were part of state Aid to Families with Dependent Children (AFDC) programs from the 1940s to the 1960s in order to estimate difference-in-difference (DiD) evaluations of the long term impacts of MITH rules on families’ access to economic resources through traditional welfare programs.

            

MITH rules, or substitute father rules, denied AFDC benefits to families when frontline welfare staff suspected an AFDC parent (generally single mothers) of cohabiting in or outside of the home with a nondisabled man. They limited families’ participation in the AFDC cash welfare program on the extensive margin, and there is reason to believe that state welfare offices disproportionately enforced these rules among Black families. I find that states’ enforcement of MITH rules reduces White and “non-White” families’ participation in AFDC. Still, compared to 1948 participation rates, the decline among Non-White families is strikingly larger than the decline among Whites, particularly in Southern states. The U.S. Supreme Court’s King v. Smith decision in 1968 invalidated MITH rules and led to a 16% increase over 1965 levels in non-White families’ participation in AFDC.

 

Relative high school completion declined 0.08–1.5 percentage points among Southern born Black birth cohorts that graduated after MITH rules were adopted, and reduced families’ access to AFDC. Conversely, education attainment rose 1.0–1.4 percentage points among Black cohorts experiencing increased access to AFDC due to the Supreme Court invalidating MITH rules. These results offer new evidence on the long-term impacts of children’s access to cash assistance programs and the consequences of historical welfare policies that disproportionately excluded “non-White” families from the social safety net.

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Link to Working Paper