American Economic Journal
Unintended Consequences of Welfare Cuts on Children and Adolescents
This paper studies the effects of a large welfare benefit reduction on the children in the affected families. The welfare cut targeted adult refugees who received residency in Denmark, and it reduced their disposable income by 30 percent on average over the first five years. We show that children exposed to the welfare cut during preschool and school-age obtained lower GPAs, experienced reduced wellbeing and overall education levels, and suffered lower employment and earnings as adults. Children in their teens at exposure faced large increases in conviction probabilities for violent and property crimes.
Related publications
Research report
Unintended Consequences of Welfare Cuts on Children and Adolescents
Go to research report
Knowledge overview
Transfer reductions to refugees yield substantial negative returns
Go to knowledge overviewLatest releases on the same welfare topic
Analysis
The Likelihood of Early Retirement Among Non-Western Immigrants Is at Its Lowest in 17 Years
November 2025
Research report
Why do coworker networks affect job search outcomes?
October 2025
Knowledge overview
The reduction of working hours in Denmark increased employment – but reduced income
October 2025
Research report
Labor-Market Effects of Introducing the 8-Hour Workday
October 2025