IDENTIFYING THE POOR: POVERTY MEASUREMENT FOR THE U.S. FROM 1996 TO 2005

Authors


  • Note: We thank two anonymous referees and the ROIW editors for their comments and suggestions. Earlier versions of this research were presented during the following: Conference on Consumption, Income, and the Well-being of Families and Children, May 4–5, 2006 in Washington, DC; 2005 Joint Statistical Meetings (JSM) in Minneapolis, Minnesota; and Bureau of Labor Statistics seminars. The comments of conference discussants, Gary Burtless and Timothy Smeeding, are appreciated. Ralph Bradley, Rob McClelland, and Uri Kogan in the Bureau of Labor Statistics Division of Price and Index Number Research, and David Johnson and Charles Nelson in the Housing and Household Economics Statistics Division from the U.S. Census Bureau also provided useful comments. Appreciation is also extended to Rob Cage, Patrick Falwell, and Mary Lynn Schmidt who provided assistance with the U.S. Consumer Price Index (CPI), and Laura Paszkiewicz, who provided assistance with the U.S. Consumer Expenditure Interview Survey. All comments greatly improved this research. The views expressed in this research, including those related to statistical, methodological, technical, or operational issues, are solely those of the authors and do not necessarily reflect the official positions or policies of the U.S. Census Bureau or U.S. Bureau of Labor Statistics, or the views of other staff members within these agencies. The authors accept responsibility for all errors.

Thesia I. Garner, Senior Research Economist, Division of Price and Index Number Research, Bureau of Labor Statistics, U.S. Department of Labor, Washington, DC 20212, USA (garner.thesia@bls.gov).

Abstract

The poverty measure presented compares spending needs to resources available to meet those needs. The analysis is for the U.S.; however, lessons from other countries regarding desirable properties of a poverty measure are considered. A primary focus is internal consistency between thresholds and resources. This study is among the first for the U.S. to describe an internally consistent poverty measure, drawing from recommendations of the U.S. National Academy of Sciences (NAS). Thresholds reflect spending needs as “outflows.” Resources measure “inflows” available to meet spending needs. The U.S. Consumer Expenditure Survey is used for thresholds, and the Current Population Survey is the basis for resources. Trends are reported with comparisons to the official and a relative measure. An important finding is that increases in expenditures for shelter, captured in the NAS thresholds, suggest a greater increase in the number of families not able to meet basic needs than is reflected by official poverty statistics over this time period.

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