From 1989 to 1996 the number of children receiving benefits from the federal Supplemental Security Income (SSI) program increased by 260 percent to 955,000. This increase followed a 1990 Supreme Court decision that liberalized the program's medical eligibility criteria for children. Recent work has documented a shift from the traditional welfare program to SSI during this period, but there has been little research investigating the effect on disadvantaged children and families. This proposal summarizes a strategy for empirically estimating the effect of child SSI participation on child poverty and parental labor supply. It is plausible that the increase in child SSI participation has reduced rates of child poverty given that SSI benefits are much more generous than welfare benefits in the typical state, with this difference increasing over time. Similarly, the shift from welfare to SSI may have affected parental labor supply given that the work incentives for a parent of a child on SSI are very different than for a parent of a child on welfare. ? ? To identify a causal relationship between SSI participation and child poverty and parental labor supply, we propose using an Instrumental Variables approach that exploits the differential growth in SSI receipt between boys and girls and female-headed families and other families. Our empirical strategy will also exploit differences across states in welfare benefit generosity. Our preliminary findings suggest that the growth in child SSI receipt significantly lowered rates of child poverty, with this effect especially large in low-AFDC benefit states such as Alabama and Mississippi. We will extend our analysis to other outcome variables of interest, beginning with maternal labor supply and later exploring the effect on fertility, family structure, child health, educational achievement, and consumption. ? ?
