Lopoo study on financial aid and family formation published in Journal of Family and Economic Issues
Feb 14, 2018
Lincoln H. Groves & Leonard M. Lopoo
Journal of Family and Economic Issues, February 2018
Leonard M. Lopoo
A broad empirical literature asks if social policies designed to provide benefits to low-income families also affect family formation patterns. While most of the evidence suggests that family formation effects are small at best, and often nonexistent, recent research argues that policies that alter budget constraints considerably should have greater family formation impacts. The authors tested this hypothesis by investigating the Social Security Student Benefit Program (SSSBP), a program designed to provide large higher education subsidies for the children of disabled, retired, or deceased parents. Conditions for receipt of SSSBP created strong incentives to delay marriage.
Utilizing data from the National Longitudinal Survey of Youth, 1979, and a difference-in-differences model, the authors found that women potentially qualifying for the SSSBP were much less likely to marry before age 22 and were older when they had children, while the program did not influence the probability of women ever marrying or having children. Impacts on men, however, were negligible.