Does the Size of the Welfare Check Matter? New Results on the Effects of Welfare Receipt on Early Childhood Cognitive Scores

Children who are exposed to household poverty have lower educational outcomes than their more advantaged peers. There is ample evidence that growing up in poverty is associated with a host of negative outcomes in terms of education, labor market, and physical and mental health (Corcoran 2001; McLoyd 1998; Duncan and Brooks-Gunn 1997). Yet, there is very little evidence that social spending has a positive effect on childhood outcomes (Dunifon and Kowaleski-Jones 2004). In fact, the majority of research indicates that social spending in such programs as AFDC is associated with negative educational outcomes. We propose to test three hypotheses regarding the generosity of one bundle of programs, TANF and Food Stamps, in the recent post-PRWORA policy environment using panel data from the Fragile Families Study. Based on prior research, we plan to explore three different mechanisms between welfare and cognitive development score based on participation status, cumulative length of receipt, and estimated total dollar amount of benefits. Our outcome of interest is the score on the Peabody Picture Vocabulary Test-III (PPVT-III), which is an instrument that provides a reliable, norm-referenced measure indicating a child's linguistic and cognitive development (Dunn and Dunn, 1997). PPVT -III is widely used as a proxy for general ability and is typically thought to be a good predictor of school performance (Brooks-Gunn, Klebanov, Smith, Duncan, and Kyunghee 2003; Brooks-Gunn, Guo, and Furstenberg 1993; Altepeter and Handal, 1985; Smith, Smith, and Dobbs, 1991; Bing and Bing, 1984; Naglieri and Pfeiffer, 1983).