Abstract
This paper investigates the long run effects of the U.S. Aid to Dependent Children (ADC) program—a cornerstone of American welfare policy introduced in 1935—on the educational and economic outcomes of children whose mothers received support. Leveraging linkages of the 1940 U.S. Census with later census records and IRS data, we assess the program’s impact on school enrollment, labor force participation, educational attainment and long-term socioeconomic attainment. Exploiting variation in ADC benefit generosity across counties and states, we estimate difference-in-differences models comparing outcomes for children of widowed to those from two-parent households. We find that higher ADC payments significantly increased school enrollment and reduced teenage labor force participation among children of widows, particularly in states that made school attendance a condition of benefit receipt. Mothers were also less likely to work and more likely to report non-wage income when benefits were more generous. Preliminary results show these short-term gains translated into higher educational attainment by 1950.