Sabbatical Seminars: Fitzgerald on How Welfare Affects Children

John Fitzgerald presents “Does PUblic Assistance Improve Long Run Outcomes for Children? Avoiding Spurious Correlations”

John Fitzgerald presents “Does Public Assistance Improve Long-Run Outcomes for Children? Avoiding Spurious Correlations”

This week’s faculty seminar series featured John Fitzgerald, Bowdoin’s William D. Shipman Professor of Economics, who gave a presentation titled “Does Public Assistance Improve Long-Run Outcomes for Children? Avoiding Spurious Correlations.” In each weekly lunch seminar, faculty from across Bowdoin’s curriculum gather for a talk by one of their colleagues, who is typically returning from a sabbatical devoted to research or an artistic project.

Children from low-income families are less healthy than their peers from more prosperous families, Fitzgerald noted, and they’re six times likelier to be poor when they reach adulthood. “This is all well known,” he said. “What I’m after is: what sort of policy interventions might be useful? And can we tease out how welfare programs, food stamps, and other forms of public assistance affect the outcomes for children from poor families?”

Studies have shown, Fitzgerald said, that children whose parents received welfare grew up to be poorer than those with parents of equivalent income who didn’t receive welfare. Yet he cautioned against jumping to conclusions about this correlation – namely, the premature conclusion that public assistance causes greater poverty.

Fitzgerald’s research suggests that there may be something causing both the parents’ choice to accept public assistance and the poor outcomes of their children. This factor – or rather, conglomeration of factors – may include characteristics that are difficult or impossible to measure, but it leaves its mark by generating measurable patterns of decision-making by parents.

“It’s like a black hole – you can only observe it because it has predictable effects on the things around it,” Fitzgerald said. Using data from the Panel Study of Income Dynamics and statistical models that control for the hidden variable and other background traits, he has found that children on welfare in fact grow up to have higher incomes than comparable children without welfare. Fitzgerald’s work continues as he explores the effects of public assistance on other child outcomes, such as health.