Essays in Public Economics

Abstract

This dissertation contains three essays on the welfare effects of government programs: the first on regulation with overlapping jurisdictions, the second on eligibility thresholds for means-tested social programs, and the third on stigma in means-tested social programs. The first chapter (coauthored with Romaine Campbell) studies how overlapping jurisdiction between state and federal authorities affects the enforcement of environmental regulation. Specifically, we ask how federal regulatory capacity affects state enforcement outcomes. We show that theoretically, a stronger federal regulatory agency can either strengthen or weaken states' negotiating position with their regulated entities, since states may not collaborate with a US Environmental Protection Agency (EPA) that is too strong. In the model, the optimal federal enforcement for the states is one that maximizes state-level negotiated penalties. We apply the model's insights in the context of environmental regulation to test whether the US EPA is too strong or too lenient in two environmental programs: the Clean Air Act and Superfund. We conclude that over one third of EPA's effect on environmental penalties is through its spillovers to state enforcement outcomes, and that states would benefit from a stronger EPA. The second chapter and third chapters (both coauthored with Charlie Rafkin) study the Supplemental Nutrition Assistance Program (SNAP). In the second chapter, we use administrative data to show that expanding eligibility for SNAP raises enrollment among households who were always eligible (those with incomes under the original eligibility threshold). We develop a general model of the optimal eligibility threshold for welfare programs with incomplete take-up and show that the social welfare implications of a higher means test depend on the mechanism (information improvements or stigma reductions) by which our main empirical effects operate. In welfare analyses, we conclude that the current SNAP eligibility threshold is lower than socially optimal. The third chapter further develops this work by exploring determinants of stigma in SNAP, providing evidence that economic conditions may affect some individuals' attitudes around welfare programs.