Three Essays on 20th Century Social Insurance in the United States

Abstract

The primary federal programs that transfer resources to Americans were established in the 1930s. Yet, despite the long history of these programs and remaining importance of the safety net in American society, our understanding of how individual decisions regarding work, marriage, and fertility have been impacted – as well as the factors shaping the scope and generosity of the safety net – is far from complete. The first chapter analyzes the effect of the Railroad Retirement Act (RRA) on retirement. Leveraging Decennial Census record linkages and comparisons between railroad and other industrial pension-covered workers, between 1930 and 1940, for pension-eligible and ineligible ages in conjunction with the change to progressive benefits, the findings suggest that elderly retirement responsiveness did not decline over the 20th century to the extent previously thought. Results also indicate important nonlinearities in how responsiveness depends on an individual's private wealth. The second chapter, written with Daniel Fetter, studies the interaction of Old Age and Survivors Insurance (OASI) growth with elderly public assistance (Old Age Assistance (OAA)) expenditure. The research design leverages cross-state differences in OASI eligibility. The findings indicate that each dollar of OASI expenditure was crowded out by between 40 and 50 cents lower OAA expenditure. Regional analyses show more crowd out among Southern states and suggestive evidence of lower taxes, whereas states in the Northeast were more likely to expand OAA. The third chapter analyzes the effect of expanding Aid to Dependent Children (ADC) in the 1960s to provide federal assistance to unemployed, two-parent families (AFDC-UP) on family structure. The research design leverages variation across states and over time in adoption of the AFDC-UP program. Results indicate nonwhite women in their 30s experienced the largest decline in the nonmarital share of births. An implication is that the rising share of births outside of marriage among nonwhite women would have been more pronounced in the absence of AFDC-UP.