Kilkenny, Maureen; Huffman, Sonya K.

American Journal of Agricultural Economics Vol. 85 no. 4 (November 2003): 914-927.

Midwestern non-metro poor participate more in the labor force and less in welfare programs than metro poor. We formalize how household composition, capital, labor market conditions, and state-specific regulations define opportunity sets, then estimate a bivariate binomial probit model of work and program participation choices. Oaxaca decomposition analysis is conducted to compare differences in characteristics to differences in behavior in explaining the two groups? choices. We find no behavioral basis for the difference in labor market participation. And while most of the lower Midwestern non-metro welfare program participation is due to demographics, some is due to different life-cycle behavior.