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Author: Vanderford, Stephanie
Resulting in 1 citation.
1. Linnenbrink, Mary
Mauldin, Teresa A.
Mimura, Yoko
Vanderford, Stephanie
Income Resources of Low-Income Families with Children: Does Cohabitation Matter?
Presented: Madison, WI, Association for Public Policy Analysis and Management (APPAM), 28th Annual Research Conference, November 2-4, 2006.
Cohort(s): NLSY79
Publisher: Association for Public Policy Analysis and Management (APPAM)
Keyword(s): Cohabitation; Earned Income Tax Credit (EITC); Family Income; Family Models; Family Structure; Income Level; Marital Status; Remarriage

Permission to reprint the abstract has not been received from the publisher.

Introduction: Among low-income families with children, do income sources differ between married couples and cohabiting couples? Using data from the National Longitudinal Survey of Youth (NSLY79), we examined low-income families' types of income sources, both earned and unearned, and amount from each source. Background: Our previous study (presented at the APPAM 2004 meeting) addressed a similar question by comparing income between families in which all members were related by birth, marriage, or adoption and other families. Among low-income families with children, few differences were found. This study refines the approach by focusing on the legal relationship between parents. Studies show that cohabiting families' financial behavior is diverse (Winkler, 1997); however, little is known about differences in the income sources of low-income married and cohabiting families with children. Theoretical focus: According to the economic model of marriage (Bryant, 1990), individuals marry and remain married when being married is more beneficial than not being married. Thus, we assume that cohabiting couples see some sort of benefits in remaining unmarried. Data and sample: The data came from the NLSY79 2002 interview, and the sub-sample for this study includes low-income (total income no more than twice the 2001 poverty thresholds) families with children younger than 18 years of age. First, both single-parent families (n=661) and two-parent families (n=911) were selected for descriptive purposes. Then for the multivariate analyses, the latter group was further divided among first-marriage families (n=613), subsequent-marriage families (n=185), and cohabiting-couple families (n=113). Three income source categories are: earned income, Earned Income Tax Credit (EITC), and all other income sources, including social insurance, transfer income, child support, and other. Methodology: Using a Double-Hurdle Cragg model for each of the three income sources, we assessed how the proba bility of receiving each income source and the amount of each were different among the three groups of two-parent families. Family and respondent socio-demographic characteristics, as well as the region of residence, were controlled. Findings: The probabilities of having the three income sources were not different among the three family types. The amounts that cohabiting-couple families received from earned and "all other" income sources were significantly lower than the amounts received by first-marriage families. Policy implications: Understanding the financial resources of low-income families, particularly those that cohabit, will help policymakers design policies to best assist such families. Results: have implications for EITC and the marriage initiative in the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA).
Bibliography Citation
Linnenbrink, Mary, Teresa A. Mauldin, Yoko Mimura and Stephanie Vanderford. "Income Resources of Low-Income Families with Children: Does Cohabitation Matter?" Presented: Madison, WI, Association for Public Policy Analysis and Management (APPAM), 28th Annual Research Conference, November 2-4, 2006.