The Effect of Economic Stability on Family Stability among Welfare Recipients

Alisa C Lewin, University of Chicago

The main rationale for defining two-parent families eligible for welfare in the United States was to keep families intact by eliminating an incentive for marital dissolution. Making aid available to two-parent families does not eliminate other reasons for family instability, most notably the reduced gain from marriage associated with having a chronically unemployed husband. This paper explores the hypothesis that husband's unemployment increases union dissolution among welfare recipients. Data for the analysis were compiled for evaluating the Link-Up demonstration project, which took place in seven counties in California's Central Valley in 1992-1994. A discrete-time event-history methodology was employed to examine family instability. The findings show that husband's unemployment and the family's long-term welfare dependency lead to breakup, net of race, age, and number of children.