Abstract: Though Social Security is typically considered a program to support retirees, nearly one in ten children live in a home with Social Security income. Children are substantially more likely to live with an older adult than they were two decades ago, and are twice as likely to report Social Security income in their household than traditional cash welfare. We use the sharp increase in eligibility for Social Security benefits at age 62 to investigate the role played by the Social Security program in childhood economic outcomes among children who live with older adults. We do not find that Social Security eligibility increases household income on average, but is associated with a shift towards Social Security income and increased availability of household members’ time for home production. Reductions in deep poverty and welfare participation are evident for some subsamples. We do not see any impact on short-run educational progression and mixed results for reported cognitive difficulty.

Lucie Schmidt is an empirical microeconomist working in the fields of labor, health and the economics of the family. Specific research areas include U.S. social safety net programs with a particular focus on programs for individuals with disabilities; retirement security; and the economics of marriage and fertility decisions. She is also a research associate at the National Bureau of Economic Research and a co-editor of the Review of the Economics of the Household. Her work has been published in the Journal of Human Resources, the Journal of Public Economics, the Journal of Health Economics, the American Journal of Health Economics, the Social Security Bulletin and Demography, among others. Schmidt teaches introductory microeconomics and courses in labor economics, gender and economics, population economics, and poverty and public policy.