BICEPS/SSE Riga Research Seminar: The Intergenerational Impact of Reduced Generosity in the Social Safety Net

We kindly invite you to the BICEPS/SSE Riga research seminar! It will take place on Thursday, October 17 at 17.00 in room 611 with the presentation:

“The Intergenerational Impact of Reduced Generosity in the Social Safety Net” by Agne Suziedelyte (City, University of London).

Abstract

This paper provides new causal evidence on how a reduction in welfare cash assistance to newly separated parents impacts the parents themselves and their young-adult children. Our paper differs from the rest of the literature evaluating the intergenerational impacts of welfare policy because it focuses on the role of welfare assistance specifically at the point of parental relationship separation. A-priori, it is unclear if a policy that provides welfare assistance to newly separated mothers produces work-disincentive effects and/or whether, on balance, it helps or hinders recovery from the event of separation. We use a reform that withdrew welfare eligibility from mothers who separated from their partners on or after 1 July 2006, while mothers who separated before this date were exempt from the new rules. We exploit this discontinuity in a Regression Discontinuity Design framework using biweekly administrative social security records. We find that the loss of welfare eligibility at the time of relationship breakdown reduces mothers’ welfare income, but increases their employment and family income. The reform is found to decrease young adults’ reliance on unemployment benefits. The effects on young adults’ receipt of other types of welfare payments, fertility, homelessness or financial independence cannot be identified precisely.

No prior registration for the seminar is necessary. For any questions about the seminar, or if you have a colleague that would like to be added to the distribution list, please write to Nicolas Gavoille.