Download or read book Essays on Public Policy and Consumer Choice written by Melissa Schettini Kearney and published by . This book was released on 2002 with total page 127 pages. Available in PDF, EPUB and Kindle. Book excerpt: (Cont.) An empirical test of the expected utility hypothesis finds that, in general, it is a reasonable description of observed consumer choices. However, the data offer some evidence in support of non-linear probability weighting in consumer preferences. The second application studied in this thesis is welfare reform. A number of states have recently instituted family cap policies, under which women who conceive a child while receiving cash assistance are not entitled to additional cash benefits. Chapter three investigates how fertility behavior responds to this change in government expenditure policy. The analysis takes advantage of the variation across states in the timing of family cap implementation to determine if these policies are discouraging women from having additional births. The data consistently demonstrate that the family cap does not lead to a reduction in births. This finding of no effect is robust to the incorporation of lead and lag effects, to considering separately total and higher-order births, and to limiting the sample to demographic groups with high welfare propensities.