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Question
in michigan, a law was passed in oct. 1 to take away welfare benefits from parents whose kids are truants. What kind of an impact would this have in the economics standpoint, both positive and negative?

Answer
This will start with a decrease in welfare spending by an amount equivalent to:
(# of people on welfare with children in violation of truancy laws*the average cost of welfare)

There's a few important things to remember, though.
1) Michigan's economy is so jacked-up right now that this move is sort-of like fighting Godzilla with a BB gun.

2) Decreased welfare benefits means decreased consumer spending, causing business sales in MI to decrease, further decreasing employment

3) Eliminating welfare benefits may actually cause truancy to increase, as families are driven into homelessness and poverty, both of which are known to increase drop-out rates

Conclusion: This law was passed without anyone having actually done the research required to determine the final outcome.  It may help, it may not, but the law was passed as a reactionary move in response to fears about government debt, rather than with sound economic research proving it would produce greater returns on investment than the spending in the first place.

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Michael Taillard

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Accepts most economic questions

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Consulting with major corporations, government agencies, political organizations, small businesses, non-profits, start-ups, and even individual people. Teaching at universities around the world, and developing original coursework. Performing original research and analysis. Writing books and scientific studies.

Organizations
American Economics Association

Publications
http://www.barnesandnoble.com/s/michael%20taillard You can also check Proquest for a small selection of my research.

Education/Credentials
PhD (Financial Economics; honors) -- MBA (International Business Finance; honors) -- Grad School Certificate (International Business Management; honors) -- BS (International Business Economics; honors) -- AA (Business Administration; honors) -- Certificate (Chinese Language and Culture) -- Trade School (Transportation Logistics; honors)

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