Income Packaging among Unwed Families: Variation across 20 Large U.S. Cities

Qin Gao, Columbia University
Irwin Garfinkel, Columbia University

Literature on income packaging mostly focuses on cross-national variations and largely ignores the specific patterns among disadvantaged groups. Using data from the Fragile Families and Child Well-Being Study, we explore whether there exists true variation in income packaging among unwed families across 20 large U.S. cities, and what state/city economic and social policy characteristics explain such variation. Descriptive and regression results show that huge variation in income packaging does exist even after accounting for local cost of living. Presence of a cohabitor ameliorates unwed families’ economic well-being. In-kind social benefits compose a significant portion while cash benefits maintain its residual role. City variations in various benefit programs persist. Stricter state welfare policies are associated with lower benefit levels. Local economic indicators show ambiguous impacts. The results reveal the importance of seeking for means of improving the well-being of benefit recipients across geographic areas given the extensive decentralization in the U.S.