Geographic Inequality in Social Provision: Variation Across the US States
In recent years, “inequality” has received an extraordinary amount of attention in political, policy, and academic circles. In the U.S., this attention has been overwhelmingly national in scope. The national focus misses a crucial axis of American inequality, one that has received inadequate attention – that is inequality by geography, specifically inequality across the U.S. states. We assess the role of state governments in social policy provision, directing attention to the consequences of policy decentralization. Using a unique dataset, we examine the magnitude of cross-state variation in the generosity of benefits and the inclusiveness of safety net provisions. We find substantial inequality across states in social provision and conclude that this constitutes a meaningful form of inequality – inequality in the treatment of similar needs and claims by people who happen to live in different states. We argue that this form of inequality deserves more sustained attention, particularly in regard to policy design. One pressing reason that cross-state policy inequality deserves increased attention is that, in some program areas, states’ policy features are strongly associated with their racial and ethnic composition. Thus, cross-state policy variation can contribute to, and exacerbate, consequential racial/ethnic disparities.
We would like to acknowledge two institutions for developing and disseminating data and/or analysis tools that enable us and other researchers to study low-income households in the United States. We acknowledge IPUMS-CPS, for providing harmonized CPS microdata; and the National Center for Children in Poverty (NCCP), for providing information that allowed us to generate our state-level income tax measures.
We would also like to recognize Marcia Meyers for her vital contributions to the development of our policy dataset – the State Safety Net Policy (SSNP) dataset – and to the larger project that sparked this paper. We also thank David Johnson, Stephen Jenkins, participants of the NBER CRIW workshop for providing insight commentary and suggestions for the analyses.
All errors are our own. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.