Four Essays on the Economics of Social Programs

Abstract

This dissertation consists of four essays focusing on specific aspects of social program design, including eligibility criteria, benefit levels, and financing. By considering the effects of these program features on labor supply, other program use, and spending, these essays aim to quantify potential costs and benefits of social policies.

The first chapter, ``Should UI Eligibility Be Expanded to Low-Earning Workers? Evidence on Employment, Transfer Receipt, and Income from Administrative Data,'' co-authored with Christopher O'Leary, examines the impact of unemployment insurance (UI) eligibility on workers' incomes after job loss. Using administrative data from Michigan, we find that while UI eligibility increases jobless durations by up to 25 percent and temporarily lowers cash assistance receipt by 63 percent, it increases income by 46-61 percent on net immediately following layoff.

The second chapter, ``The Effect of Unemployment Benefits on the Duration of Unemployment Insurance Receipt: New Evidence from a Regression Kink Design in Missouri, 2003-2013,'' co-authored with David Card, Andrew Johnston, Alex Mas, and Zhuan Pei, considers the effect of UI benefit levels on UI durations. By exploiting quasi-experimental variation generated by a kinked benefit schedule, we find that durations are more responsive to benefit levels during and following the recession, with an elasticity of 0.65-0.9 as compared to 0.35 pre-recession.

The third chapter, ``Employment Effects of the ACA Medicaid Expansions,'' co-authored with Alex Mas, examines whether the recent Medicaid expansions from the Affordable Care Act reduced “employment lock” among previously ineligible childless adults. By comparing states that did or did not choose to expand Medicaid, before and after implementation, we find that although Medicaid coverage increased by 3.0 percentage points among childless adults, there was no significant impact on employment.

The fourth chapter, ``State Responses to Federal Matching Grants: The Case of Medicaid,'' studies the effect of federal matching payments on state Medicaid expenditures. Using variation in the state's share of Medicaid costs generated by an expenditure cap, I estimate a price elasticity of -0.95. I then consider a model of decentralized redistribution, a conventional justification for matching grants, and find that the optimal matching rate is bounded above by 73 percent.