The Effects of Welfare-to-Work Program Activities on Labor Market Outcomes

48 Pages Posted: 15 Mar 2005

See all articles by Andrew Dyke

Andrew Dyke

University of North Carolina at Chapel Hill

Carolyn Heinrich

Vanderbilt University; University of Texas at Austin

Peter R. Mueser

University of Missouri; IZA Institute of Labor Economics

Kenneth R. Troske

University of Kentucky - Department of Economics; University of Missouri at Columbia - Department of Economics; IZA Institute of Labor Economics

Date Written: March 2005

Abstract

Studies examining the effectiveness of welfare-to-work programs present findings that are mixed and sometimes at odds, in part due to research design, data, and methodological limitations of the studies. We aim to substantially improve on past approaches to estimate program effectiveness by using administrative data on welfare recipients in Missouri and North Carolina to obtain separate estimates of the effects of participating in sub-programs of each state's welfare-to-work program. Using data on all women who entered welfare between the second quarter of 1997 and fourth quarter of 1999 in these states, we follow recipients for sixteen quarters and model their quarterly earnings as a function of demographic characteristics, prior welfare and work experience, the specific types of welfare-to-work programs in which they participate, and time since participation. We focus primarily on three types of sub-programs - assessment, job readiness and job search assistance, and more intensive programs designed to augment human capital skills - and use a variety of methods that allow us to compare how common assumptions influence results. In general, we find that the impacts of program participation are negative in the quarters immediately following participation but improve over time, in most cases turning positive in the second year after participation. The results also show that more intensive training is associated with greater initial earnings losses but also greater earnings gains in the long run.

Keywords: evaluation, training, sub-programs, welfare

JEL Classification: J31

Suggested Citation

Dyke, Andrew and Heinrich, Carolyn and Mueser, Peter R. and Troske, Kenneth R., The Effects of Welfare-to-Work Program Activities on Labor Market Outcomes (March 2005). Available at SSRN: https://ssrn.com/abstract=683984

Andrew Dyke

University of North Carolina at Chapel Hill ( email )

102 Ridge Road
Chapel Hill, NC NC 27514
United States

Carolyn Heinrich

Vanderbilt University ( email )

2301 Vanderbilt Place
Nashville, TN 37240
United States
615-322-1169 (Phone)

HOME PAGE: http://peabody.vanderbilt.edu/bio/carolyn-heinrich

University of Texas at Austin ( email )

2315 Red River St.
Austin, TX 78713
United States
512-471-3200 (Phone)

HOME PAGE: http://www.utexas.edu/lbj/directory/faculty/carolyn-heinrich

Peter R. Mueser

University of Missouri ( email )

331 Professional Building
Dept. Economics and Truman School Public Affairs
Columbia, MO 65211
United States
573-882-6427 (Phone)

HOME PAGE: http://web.missouri.edu/~mueser/

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Kenneth R. Troske (Contact Author)

University of Kentucky - Department of Economics ( email )

Lexington, KY 40506
United States

University of Missouri at Columbia - Department of Economics ( email )

118 Professional Building
Columbia, MO 65211
United States
573-882-4229 (Phone)
573-882-2697 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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