The Efficacy of Cash Supports for Children by Race and Family Size: Understanding Disparities and Opportunities for Equity

Abstract

More than one-third of US children live in families with three or more children. The contemporary impact of larger family size on children’s family resources remains an under-explored point of inequity. Larger family size is not only more common among Black and Hispanic children, but Black and Hispanic children in larger families (Black children, especially so) face higher poverty risks relative to White children in larger families. This analysis uses children’s number of siblings and children’s race and ethnicity to chart the intersectional aspects of disparity in the risk and incidence of poverty and the anti-poverty effects of large federal cash supports, the Earned Income Tax Credit and Child Tax Credit. It draws upon 2014–2017 Current Population Survey data and the NBER TAXSIM calculator to apply 2018 tax law, inclusive of the Tax Cuts and Jobs Act of 2017. It reveals well-documented disparities in poverty rates and benefit access and receipt experienced by children of color are further exacerbated by policy structures that discriminate against an under-acknowledged aspect of children’s family life: their family size. Racial bias in policy design that sees tax credit access mechanisms and earnings and benefit structures disproportionately exclude that Black and Hispanic children also disproportionately exclude Black and Hispanic children by their family size. Without reforms that tackle both inequities, policy action that closes the poverty gap between larger and smaller families will see the racial gap in child poverty remain.