December 2009

No. 4659: Welfare Usage in the U.S.: Does Immigrant Birthplace and Immigration Status Matter?

Ruth Uwaifo Oyelere, Maharouf Oyolola

revised version published as 'Do Immigrant Groups Differ in Welfare Usage? Evidence from the U.S.A' in: Atlantic Economic Journal, 2011, 39 (3), 231-247

The study of welfare participation in the U.S. prior to the 1996 welfare reform act and even afterward has focused on comparisons between native born and immigrant households. Analyses that have gone beyond this broad classification have focused on comparisons across race or with particular focus on particular groups like Hispanic immigrants. To the best of our knowledge, there is no study yet that tests for difference in welfare usage among immigrant groups and immigrant status. We do not expect welfare usage to differ among immigrant groups if we control for the factors that should predict welfare usage. Similarly, if immigration status does not prevent welfare usage for certain immigrants, then ceteris paribus, we do not expect welfare usage to differ among immigrant based on status. We investigate these possibilities by testing three related hypothesis using probability models. Our results suggest that birth place matters and the probability of welfare usage is not the same for all groups. We also find that for some birthplace groups, citizen and non-citizens differ with respect to welfare usage. Finally, we find that post welfare reform, the probability of being on welfare in comparison to U.S. born increased for all immigrant groups and these increases differed across groups. We provide possible explanations for our unexpected results.