Demographic Change and Public Assistance Expenditures
Growth in overall real welfare expenditures per capita has been a noted trend in the last thirty years in the U.S. The influence of demographic forces in contributing to this growth is considered in this paper. It is found that the growth of female-headed families is the strongest and dominant force in contributing to trends in real AFDC expenditures per capita over the long run. The influence of demographic growth is especially strong for the black population. For the Food Stamp and Medicaid programs, increases in participation rates, on the other hand, have been more important. Projections of future trends in the age, race, and sex composition of the U.S. population show that expenditures in none of these programs is likely to respond to such basic demographic trends, however.
Robert A. Moffitt
Department of Economics
Johns Hopkins University