TITLE

Endogenous neighborhood effects on welfare participation

AUTHOR(S)
Shang, Qingyan
PUB. DATE
September 2014
SOURCE
Empirical Economics;Sep2014, Vol. 47 Issue 2, p639
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
This article examines the impact of neighborhood welfare participation on individual welfare participation, that is, the endogenous neighborhood effects. Endogenous neighborhood effects generate social multipliers. Few existing empirical studies on neighborhood effects distinguish between endogenous neighborhood effects and exogenous neighborhood effects, that is, the effects of neighborhood characteristics. This article constitutes an early attempt to identify and estimate endogenous and exogenous neighborhood effects separately. I construct an instrumental variable for neighborhood welfare participation rate based on the variation in welfare benefits and neighborhood demographic composition to address the reflection problem and the omitted neighborhood variables problem. A two-step method is proposed to separately estimate endogenous and exogenous neighborhood effects. The results show that neighborhood welfare participation plays an important role in a woman's welfare participation both before and after the welfare reform in 1996.
ACCESSION #
97288609

 

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