Time-inconsistency and welfare program participation: Evidence from the nlsy

Hanming Fang, Daniel Silverman

Research output: Contribution to journalArticle

45 Citations (Scopus)

Abstract

We empirically implement a dynamic structural model of labor supply and welfare program participation for agents with potentially time-inconsistent preferences. Using panel data on the choices of single women with children from the National Longitudinal Surveys (NLSY) 1979, we provide estimates of the degree of time-inconsistency, and of its influence on the welfare take-up decision. With these estimates, we conduct counterfactual experiments to quantify a measure of the utility loss stemming from the inability to commit to future decisions, and the potential gains from commitment mechanisms such as welfare time limits and work requirements.

Original languageEnglish (US)
Pages (from-to)1043-1077
Number of pages35
JournalInternational Economic Review
Volume50
Issue number4
DOIs
StatePublished - Nov 2009
Externally publishedYes

Fingerprint

Time inconsistency
Program participation
Welfare programs
Time-inconsistent preferences
Dynamic structural model
Experiment
Labor supply
Panel data

ASJC Scopus subject areas

  • Economics and Econometrics

Cite this

Time-inconsistency and welfare program participation : Evidence from the nlsy. / Fang, Hanming; Silverman, Daniel.

In: International Economic Review, Vol. 50, No. 4, 11.2009, p. 1043-1077.

Research output: Contribution to journalArticle

@article{43762fef58964353b8a2c8ffc5472af7,
title = "Time-inconsistency and welfare program participation: Evidence from the nlsy",
abstract = "We empirically implement a dynamic structural model of labor supply and welfare program participation for agents with potentially time-inconsistent preferences. Using panel data on the choices of single women with children from the National Longitudinal Surveys (NLSY) 1979, we provide estimates of the degree of time-inconsistency, and of its influence on the welfare take-up decision. With these estimates, we conduct counterfactual experiments to quantify a measure of the utility loss stemming from the inability to commit to future decisions, and the potential gains from commitment mechanisms such as welfare time limits and work requirements.",
author = "Hanming Fang and Daniel Silverman",
year = "2009",
month = "11",
doi = "10.1111/j.1468-2354.2009.00559.x",
language = "English (US)",
volume = "50",
pages = "1043--1077",
journal = "International Economic Review",
issn = "0020-6598",
publisher = "Wiley-Blackwell",
number = "4",

}

TY - JOUR

T1 - Time-inconsistency and welfare program participation

T2 - Evidence from the nlsy

AU - Fang, Hanming

AU - Silverman, Daniel

PY - 2009/11

Y1 - 2009/11

N2 - We empirically implement a dynamic structural model of labor supply and welfare program participation for agents with potentially time-inconsistent preferences. Using panel data on the choices of single women with children from the National Longitudinal Surveys (NLSY) 1979, we provide estimates of the degree of time-inconsistency, and of its influence on the welfare take-up decision. With these estimates, we conduct counterfactual experiments to quantify a measure of the utility loss stemming from the inability to commit to future decisions, and the potential gains from commitment mechanisms such as welfare time limits and work requirements.

AB - We empirically implement a dynamic structural model of labor supply and welfare program participation for agents with potentially time-inconsistent preferences. Using panel data on the choices of single women with children from the National Longitudinal Surveys (NLSY) 1979, we provide estimates of the degree of time-inconsistency, and of its influence on the welfare take-up decision. With these estimates, we conduct counterfactual experiments to quantify a measure of the utility loss stemming from the inability to commit to future decisions, and the potential gains from commitment mechanisms such as welfare time limits and work requirements.

UR - http://www.scopus.com/inward/record.url?scp=70350491388&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=70350491388&partnerID=8YFLogxK

U2 - 10.1111/j.1468-2354.2009.00559.x

DO - 10.1111/j.1468-2354.2009.00559.x

M3 - Article

AN - SCOPUS:70350491388

VL - 50

SP - 1043

EP - 1077

JO - International Economic Review

JF - International Economic Review

SN - 0020-6598

IS - 4

ER -