Incentive to Retrench? Investigating the Interactions of State and Federal Social Assistance Programs after Welfare Reform

Spending on cash assistance from the Temporary Assistance for NeedyFamilies (TANF) program has declined throughout the United States in recent decades.Simultaneously, spending on the federally funded Supplemental Nutrition AssistanceProgram (SNAP) and Supplemental Security Income (SSI) programs has increased. Thisarticle investigates whether retrenchment of TANF has led to increases in the par-ticipation in and levels of benefit receipt of SNAP and SSI. Applying a differences-in-differences approach on household income data from 1997 to 2015, we find thata $50 policy-induced decline in states’ TANF cash assistance allocations leads to anincrease of $17–$32 per month in SNAP and SSI benefit allocations among single-mother households. From a household perspective, these findings suggest that SNAPand SSI benefits have partially offset TANF’s decline. From a state incentive perspec-tive, we find state governments have the ability, and a financial incentive, to shift socialassistance caseloads to the federal government.