What Is the Long-Term Impact of Zebley on Adult and Child Outcomes?

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In 1990, the U.S. Supreme Court decision in the Sullivan vs. Zebley case fundamentally changed, albeit temporarily, the criteria under which children qualified for the Supplemental Security Income (SSI) program. Instead of a pure impairment-based system, from 1990 until the 1996 enactment of the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA), children’s eligibility for SSI was tied to performance in school. This paper examines what happened to the Zebley cohort after the age of 18 relative to cohorts who received SSI benefits under stricter criteria. This paper evaluates the long-term impact on educational attainment, earnings, SSI and Social Security disability insurance (SSDI) participation, and other markers of adult development for the Zebley cohort. Using state Temporary Assistance for Needy Families (TANF) benefits as instrumental variables for SSI participation, we estimate the causal effect of SSI receipt on outcomes among those whose families had the largest financial gain by receiving SSI during the Zebley period. We find that, overall, SSI receipt in childhood causes more positive outcomes than negative ones. The Zebley cohort has a higher likelihood of positive earnings after age 18 and a lower likelihood of welfare receipt in later childhood, but also a higher likelihood of lacking health insurance coverage and applying to SSI as an adult. These results suggest that SSI receipt at the margin helps improve, or at least does not hurt, adult outcomes.