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Abstract

Recent years have witnessed an intensification of the debate about the fundamental purpose of public assistance to the poor and the effects of these programs on children. This study uses enriched data from the Panel Study of Income Dynamics to examine the effects of living in public housing as a child at some point between 1968 and 1982 on four young adult outcomes: welfare receipt; individual earnings; household earnings relative to the federal poverty line; and employment. Living in public housing during childhood increased employment, raised earnings, and reduced welfare use, but had no effect on household earnings relative to the poverty line. The beneficial effects could have arisen because public housing improved physical living conditions, reduced residential mobility, or enabled families to spend more of their income on items that benefit children's development. Whether these effects apply to contemporary public housing is unknown. © 2002 by the Association for Public Policy Analysis and Management.