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Lab for Economic Opportunities (LEO) reported RCT results for Padua, an intensive case management program for low-income adults, aimed at moving them permanently out of poverty. Quick take: High-quality RCT finds suggestive, but at best modest, effects on earnings, employment, etc over 2-5 year follow-up.

Program:

  • Per the study: Padua is "a holistic, individualized wrap-around service intervention [that] includes a detailed assessment, an individualized service plan, intensive case management administered by a two-person team [and] temporary financial assistance." Cost is $23k per person.  


Study Design:

  • The study sample comprised 427 low-income adults in Tarrant County TX, randomly assigned to treatment (full Padua program) versus control (usual services).


Findings:

  • At the 2-year mark, the study survey found Padua increased earnings by 18% (vs a control average of $1149 per month) and employment by 6% points (vs control group's 63%). But neither effect was statistically significant, so these effects are best viewed as suggestive (could be due to chance).


  • Also, surveys are vulnerable to "social desirability bias" - i.e., treatment group members know the program's goals and may overstate their workforce success to show they’ve made good use of the assistance.


  • The study also measured workforce outcomes with state records, and found near-zero impact on earnings and a non-significant 5% point increase in employment over 4.5 years (and similar over 2 years). Such records avoid social desirability bias but don't count informal (e.g., gig) jobs, so may modestly understate employment/earnings for both treatment and control groups.


  • Finally, in the survey measures and state records, the study found no overall pattern of effects on other pre-specified main outcomes: debt, savings, household income, use of government assistance, or health.


Comment:

  • Based on careful review, I believe this was a well-conducted RCT with important but mostly disappointing findings: Despite the program's intensity and cost, it didn't discernably lift people out of poverty and toward self-sufficiency.

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