Matthew Yglesias reports another dramatic study providing evidence against the safety net as hammock hypothesis. The argument that just giving poor people cash helps in the short run but hurts in the long run by creating dependency is extremely influential. The evidence supports the opposite conclusion.
Here I note Yglesias noting Moises Velazquez-Manoff noting another study.
here’s a great writeup from Moises Velazquez-Manoff of a study of an unconditional cash transfer program related to a casino gambling windfall along the Cherokee that suggests yes it can:
[J]ust four years after the supplements began, Professor Costello observed marked improvements among those who moved out of poverty. The frequency of behavioral problems declined by 40 percent, nearly reaching the risk of children who had never been poor.
Yglesias also mentions that
the best evidence we have shows a large positive impact of welfare checks on life outcomes for kids who benefitted from the pre-Depression version of cash assistance for poor single moms
He didn’t mention the evidence that, in the very long run, food stamps reduce obesity and increase high school graduation rates.
Or the genuinely experimental evidence (I am tempted to type proof) that welfare reform kills people.
I wonder if the flood of excellent empirical work might have some effect on the policy debate. I know this is naive, but I don’t think it’s crazy. Pundits have noticed that the USA is no longer the land of opportunity with low inter-generational income mobility. I think there is a chance that they will discover that the indirect behavioral benefits of cash assistance outweigh the indirect costs.