Poverty in America: is Welfare the Answer or the Problem?

36 Pages Posted: 25 Jun 2004 Last revised: 6 Sep 2010

See all articles by David T. Ellwood

David T. Ellwood

Harvard University - Harvard Kennedy School (HKS); National Bureau of Economic Research (NBER)

Lawrence H. Summers

Harvard University; National Bureau of Economic Research (NBER); Harvard University - Harvard Kennedy School (HKS)

Date Written: October 1985

Abstract

This paper reviews the current policies for fighting poverty and explores the impact they have had. We begin by reviewing trends in poverty, poverty spending and economic performance. It is immediately apparent that economic performance is the dominant determinant of the measured poverty rate over the past two decades. Government assistance programs expanded greatly over this period, but the growth in cash assistance was too modest to have major effects, and the large growth in in-kind benefits could not reduce measured poverty since such benefits are not counted as income. Next we focus on three groups: the disabled, female family heads, and unemployed black youth. We find little evidence that government deserves the blame for the problems of each group, and suggest that the broad outlines of current policies are defensible on economic grounds.

Suggested Citation

Ellwood, David T. and Summers, Lawrence H., Poverty in America: is Welfare the Answer or the Problem? (October 1985). NBER Working Paper No. w1711. Available at SSRN: https://ssrn.com/abstract=227408

David T. Ellwood (Contact Author)

Harvard University - Harvard Kennedy School (HKS) ( email )

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National Bureau of Economic Research (NBER)

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Lawrence H. Summers

Harvard University ( email )

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Cambridge, MA 02138
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617-495-1502 (Phone)
617-495-8550 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Harvard University - Harvard Kennedy School (HKS) ( email )

79 John F. Kennedy Street
Cambridge, MA 02138
United States

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