Effects of Welfare Reform on Education Acquisition of Adult Women

Education beyond traditional ages for schooling is an important source of human capital acquisition among adult women. Welfare
reform, which began in the early 1990s and culminated in the passage of the Personal Responsibility and Work Opportunity Reconciliation
Act in 1996, promoted work rather than education acquisition for this group. Exploiting variation in welfare reform across
states and over time and using relevant comparison groups, we undertake a comprehensive study of the effects of welfare reform
on adult women’s education acquisition. We first estimate effects of welfare reform on high school drop-out of teenage girls,
both to improve upon past research on this issue and to explore compositional changes that may be relevant for our primary
analyses of the effects of welfare reform on education acquisition among adult women. We find that welfare reform significantly
reduced the probability that teens from disadvantaged families dropped out of high school, by about 15%. We then estimate
the effects of welfare reform on adult women’s school enrollment and conduct numerous specification checks, investigate compositional
selection and policy endogeneity, explore lagged effects, stratify by TANF work incentives and education policies, consider
alternative comparison groups, and explore the mediating role of work. We find robust and convincing evidence that welfare
reform significantly decreased the probability of college enrollment among adult women at risk of welfare receipt, by at least
20%. It also appears to have decreased the probability of high school enrollment among this group, on the same order of magnitude.
Future research is needed to determine the extent to which this behavioral change translates to future economic outcomes.