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The U.S. welfare reforms of the 1990s have generated extensive interest. Both the federal changes in work support programs like the EITC and the revolution in the design of state public assistance programs have drawn research attention. While it is far too early to draw any final conclusions about the long-term effects of these program changes, the research literature to date has produced several important results. More significant caseload declines and larger increases in labor force participation among less-skilled mothers occurred than many observers would have predicted. Entry into welfare fell, and exits from welfare rose. There remains debate as to how much these results were due to a strong economy, to program reform, or to their interactive effects. While some of this change in behavior is due to traditional labor supply responses to growing wages and increased financial incentives to work, the changes were greater than historical experience would lead one to expect.

This paper discusses the reasons why the current official U.S. poverty measure is outdated and nonresponsive to many anti-poverty initiatives. A variety of efforts to update and improve the statistic have failed, for political, technical, and institutional reasons. Meanwhile, the European Union is taking a very different approach to poverty measurement. The paper ends with four recommended steps that would allow the U.S. to improve its measurement of poverty and economic need.\"

As productivity growth has slowed and wages have stagnated in the past decade, there is serious concern about the long-term competitiveness of the U.S. economy. This article discusses key factors that affect U.S. economic growth, including the number of workers, their skill level, and the level of innovation and investment in new ideas. There are limited prospects for growth in the number of workers, due to changes in age distribution, immigration, and women's labor force participation. There has been a slow increase in worker skills in the United States, and there are opportunities for further growth in educational attainment. The role of innovation in developing new products and services that improve our wellbeing and drive productivity growth is a key driver of long-term growth, which means that the United States needs to stay at the front edge of basic and translational research. In recent decades, the preeminent U.S. position in the world economy has eroded as other countries have outstripped the United States in the growth of their educated workforce. At the same time, other countries have greatly increased their investments in basic research and innovation while U.S. investments have stalled. If the United States is to retain its long-term economic leadership, it must pay attention to policies that will enhance skills and innovation. The large public research university—an institution largely invented in the United States—has a key role to play.

Rebecca Blank explores a weakness of the welfare reforms of the mid-1990s-the failure of the Temporary Assistance to Needy Families program to address the plight of so-called \"hard to employ\" single mothers and their children. TANF has moved many women on the welfare caseload into work, but the services it provides are not intensive or flexible enough to meet the needs of women with multiple disadvantages who find it difficult to get and keep full-time employment. Blank notes that many of these women have lost welfare benefits because of their failure to find work. Increasingly, studies show that the number of single mothers who are neither working nor on welfare has grown significantly over the past ten years. Such \"disconnected\" women now make up 20 to 25 percent of all low-income single mothers, and reported income in these families is extremely low. Disconnected women are likely to report multiple and serious barriers to work, including low education, learning disabilities, health problems, or a history of domestic violence or substance abuse. Counting both longer-term welfare recipients and women who are neither working nor on welfare, Blank estimates that about 2.2 million women who head families are not able to find jobs or, if they do, cannot keep them. And almost 4 million children are in the care of these severely challenged single mothers. Blank proposes a Temporary and Partial Work Waiver Program to provide more effective employment assistance and other supports for these women and their children. The program she proposes would recognize that some women might be able to work only part-time or be temporarily unable to work. It would supplement their earnings while also offering referral to services that both address their own work barriers and provide help for their children. The support, however, would be temporary. Women would be regularly reassessed for their readiness to return to work or work more hours. Such a program, Blank notes, would require intensive case management. Estimating the cost of such a program is difficult, she explains, because costs would depend heavily on the number of women who participate. But she offers a rough estimate of $2.8 billion, some of which is already being spent as part of the current TANF program.

The privatisation of social services is being increasingly discussed. The social services market is characterised by multiple market failures, including informational asymmetries, agency problems, externalities, and distributional concerns. Consumers may care as much or more about quality of services than about price. If quality is readily observable, the government can regulate private providers to assure standards are met. But when standards are difficult to observe or when the recipient is not the agent who makes the decisions, government ownership may be preferable. This paper categorises the market situations in which government provision of social services is likely to be most versus least attractive.

As the Clinton administration considers major overhauls in health insurance, welfare, and labor market regulation, it is important for economists and policymakers to understand the impact of social and welfare programs on employment rates. This volume explores how programs such as social security, income transfers, and child care in Western Europe, the United States, and Japan have affected labor market flexibility—the ability of workers to adjust to fast-growing segments of the economy. Does tying health insurance to employment limit job mobility? Do housing policies inhibit workers from moving to new jobs in different areas? What are the effects of daycare and maternity leave policies on working mothers? The authors explore these and many other questions in an effort to understand why European unemployment rates are so high compared with the U.S. rate. Through an examination of diverse data sets across different countries, the authors find that social protection programs do not strongly affect labor market flexibility. A valuable comparison of labor markets and welfare programs, this book demonstrates how social protection policies have affected employment rates around the globe.

Rebecca M. Blank offers the first comprehensive analysis of an economic trend that has been reshaping the United States over the past three decades: rapidly rising income inequality. In clear language, she provides an overview of how and why the level and distribution of income and wealth has changed since 1979, sets this situation within its historical context, and investigates the forces that are driving it. Among other factors, Blank looks closely at changes within families, including women’s increasing participation in the work force. The book includes some surprising findings—for example, that per-person income has risen sharply among almost all social groups, even as income has become more unequally distributed. Looking toward the future, Blank suggests that while rising inequality will likely be with us for many decades to come, it is not an inevitable outcome. Her book considers what can be done to address this trend, and also explores the question: why should we be concerned about this phenomenon?

This paper investigates the impact of changes in earnings disregards for welfare assistance received by single mothers following welfare reform in 1996. Some states adopted much higher earnings disregards (women could work full-time and still receive substantial welfare benefits), while other states did not. We explore the effect of these changes on women's labor supply and income using several data sources and multiple estimation strategies. Our results indicate these changes had little effect on labor supply or income. We show this is because surprisingly few women used the earnings disregards. We discuss several explanations for why this might occur. © 2013 by the Association for Public Policy Analysis and Management.

In the great tradition of moral argument about the nature of the economic market, Rebecca Blank and William McGurn join to debate the fundamental questions-equality and efficiency, productivity and social justice, individual achievement and personal rights in the workplace, and the costs and benefits of corporate and entrepreneurial capitalism. Their arguments are grounded in both economic sophistication and religious commitment. Rebecca Blank is an economist by training and describes herself as \"culturally Protestant in the habits of mind and heart.\" She has also chaired the committee that wrote the statement on Christian faith and economic life adopted by the United Church of Christ. Addressing market failure, for her, requires that sometimes \"freedom to choose\" give way to other human values. William McGurn, a journalist and a Roman Catholic, uses his expertise in economics to reflect on the teachings of the church concerning the morality of the market. For McGurn, humans reach their fullest potential when they are free from the constraints of others. He writes that \"our quarrel is not so much with Adam Smith or Milton Friedman but with the Providence that so clearly designed man to be his most prosperous at his most free.\" This book grapples with the new imperatives of a global economy while working in the classic tradition of political economy which always treated seriously the questions of morality, justice, productivity, and freedom.