AbstractOver the past two decades, federal and state policymakers have dramatically reshaped
the nation’s system of cash welfare assistance for low-income families. During this
period, there has been considerable variation from state to state in approaches to
welfare reform, which are often collectively referred to as “welfare-to-work
programs.” This article synthesizes an extraordinary body of evidence: results from
28 benefit-cost studies of welfare-to-work programs based on random assignment
evaluation designs. Each of the 28 programs can be viewed as a test of one of six
types of welfare reform approaches: mandatory work experience programs, mandatory
job-search-first programs, mandatory education-first programs, mandatory
mixed-initial-activity programs, earnings supplement programs, and time-limit-mix
programs. After describing how benefit-cost studies of welfare-to-work programs are
conducted and considering some limitations of these studies, the synthesis addresses
such questions as: Which welfare reform program approaches yield a positive return on
investments made, from the perspective of program participants and from the
perspective of government budgets, and the perspective of society as a whole? Which
approaches make program participants better off financially? In which approaches do
benefits exceed costs from the government’s point of view? The last two of these
questions coincide with the trade-off between reducing dependency on government
benefits and ensuring adequate incomes for low-income families. Because the
benefit-cost studies examined program effects from the distinct perspectives of
government budgets and participants’ incomes separately, they address this trade-off
directly. The article thus uses benefit-cost findings to aid in assessing the often
complex trade-offs associated with balancing the desire to ensure the poor of
adequate incomes and yet encourage self-sufficiency.
Lessons for Welfare Reform: An Analysis of the AFDC Caseload and Past Welfare-to-Work Programs