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Privatization and the Poor: Exploring Patterns in Welfare Contracting

This study explores state-level administrative contracting patterns in social welfare programs that extend street-level administrative authority to private sector providers. Workfare reforms in the 1990s devolved welfare policy-making authority and encouraged administrative diversity resulting in unique implementation arrangements across the American states, yet the forces underlying privatization patterns remain understudied. Utilizing privatization data for the year 2001 from the General Accounting Office, this study finds that state urbanization and African American welfare demand are significantly associated with welfare contracting. In addition, Mississippi and Washington, DC, are found to exhibit a proclivity toward welfare privatization unmatched by other jurisdictions.