Homelessness, poverty, and economic policy [electronic resource]

This dissertation consists of three distinct chapters exploring the topics of homelessness, poverty, and economic policy. In the first chapter, I quantify behavioral responses to homeless program generosity to study the tradeoffs inherent in expanding homeless assistance. I utilize a new, national dataset on sheltered and unsheltered homeless populations and exploit differential distribution of federal homeless assistance grants across communities. An outdated formula sets each region's funding eligibility, inadvertently generating exogenous variation in homeless assistance. Program providers use the resulting marginal funds to add beds in both individual and family programs. Homeless individuals and families, however, have very different characteristics and behavioral patterns. I find that greater individual program generosity reduces unsheltered homelessness without drawing others into the local homeless population. A permanent $100,000 annual increase in homeless assistance decreases the size of the unsheltered population by 35 individuals, and all of the individuals who utilize marginal beds would otherwise be unsheltered. The effects of family program expansions are quite different. More generous funding helps house otherwise unsheltered families while also drawing in a larger homeless family population (73 additional people in families for every $100,000). I show that this increase is primarily driven by homeless families migrating to communities with greater funding. These results illuminate the policy responsiveness of homeless populations and shed light on the efficacy of homeless assistance funding. In the second chapter, joint with B. Douglas Bernheim and Andrey Fradkin, I study the welfare economics of default options in the context of retirement savings. Default contribution rates for 401(k) pension plans powerfully influence choices, and potential causes include opt-out costs, pro-crastination, inattention, and psychological anchoring. Using realistically parameterized models, we show how the optimal default, the magnitude of the welfare effects, and the degree of normative ambiguity depend on the behavioral model, the scope of the choice domain deemed welfare-relevant, the use of penalties for passive choice, and other 401(k) plan features. While results are theory-specific, our analysis provides reasonably robust justifications for setting the default either at the highest contribution rate matched by the employer or -- contrary to common wisdom -- at zero. The final chapter explores the economic history of the "orphan trains." By the middle of the nineteenth century, one out of every one hundred residents of New York City was a homeless child. iv Meanwhile, the American frontier was growing rapidly, in need of manpower and inexpensive labor. In 1853, Charles Loring Brace founded the Children's Aid Society to collect New York's homeless children and re-locate them to rural families. The trains which brought these children to their new homes became known as "orphan trains." I conduct a pilot study to undertake the first quantitative analysis of the orphan train program using a small, random sample of Children's Aid Society records. I study family selection into the program, exploring which groups disproportionately participated in this reallocation of children. Then, I ask which factors predict the breakdown and dissolution of the ensuing informal adoptions. I find that child age and existing family structure are the strongest predictors of child-family match failure. I conclude by arguing that the orphan trains provide a fascinating setting and novel identification strategies for research in family economics and economic history, outlining the next steps in the agenda.

Keywords: Economics.
Advisor: Einav Liran primary advisor. Thesis advisor
Abramitzky Ran advisor. Thesis advisor
Hoxby Caroline Minter advisor. Thesis advisor