MFIP Incentives Only used financial work incentives to increase employment and reduce poverty among recipients of Aid to Families with Dependent Children (AFDC).  

MFIP Incentives Only used financial work incentives to increase employment and reduce poverty among recipients of Aid to Families with Dependent Children (AFDC).  

MFIP Incentives Only was one of the demonstration projects made possible by Section 1115 waivers to the rules in effect at the time for the AFDC program. These Section 1115 waivers allowed states to test new approaches to advance the objectives of the AFDC program. MFIP Incentives Only used financial incentives to encourage AFDC recipients to work and reduce their dependence on public assistance.

First, MFIP Incentives Only increased the basic AFDC grant by 20 percent if participants worked and reduced AFDC benefits by only 62 percent for every earned dollar (rather than dollar for dollar). MFIP Incentives Only also made it easier for families to receive benefits by combining families’ AFDC, Food Stamps (provided in cash, rather than coupons), and Family General Assistance (a state-funded cash assistance program) into one monthly payment. Finally, MFIP Incentives Only paid child care costs directly to providers rather than reimbursing parents for costs paid out of pocket. Clients could receive MFIP services as long as they remained enrolled in AFDC. All AFDC, Food Stamps, or Family General Assistance applicants and recipients were eligible to participate in MFIP Incentives Only. The MFIP Incentives Only program was implemented in three urban Minnesota counties (Hennepin, Anoka, and Dakota). The evaluation of MFIP Incentives Only, which focused on single-parent households that were either recent applicants to MFIP or long-term recipients, was part of a larger evaluation of MFIP. The larger evaluation also tested the effectiveness of a version of the intervention that include a work requirement (MFIP) and compared the effectiveness of MFIP Incentives Only and MFIP.

Year evaluation began: 1994
Populations and employment barriers: Parents, Single parents, Cash assistance recipients
Intervention services: Financial incentives, Supportive services
Setting(s): Urban only

Effectiveness Rating and Effect By Outcome Domain

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Outcome domain Term Effectiveness rating Effect in 2018 dollars and percentages Effect in standard deviations Sample size
Increase earnings Short-term Little evidence to assess support 0
Long-term Little evidence to assess support unfavorable $-941 per year -0.05 4882
Very long-term No evidence to assess support
Increase employment Short-term Supported favorable 2% (in percentage points) 0.04 4882
Long-term Supported favorable 2% (in percentage points) 0.05 4882
Very long-term No evidence to assess support
Decrease benefit receipt Short-term Little evidence to assess support 0
Long-term Little evidence to assess support 0
Very long-term No evidence to assess support
Increase education and training All measurement periods No evidence to assess support

Studies of this Intervention

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Study Quality Rating Study Counts per Rating
High High 2