Measuring poverty : a new approach / Constance F. Citro and Robert T. Michael, editors ; Panel on Poverty and Family Assistance: Concepts, Information Needs, and Measurement Methods ... [et al.].

Format:

Book

Contributor:

Citro, Constance F. (Constance Forbes), 1942-

Michael, Robert T.

Panel on Poverty and Family Assistance (United States)

Language:

English

Subjects (All):

Poverty--United States--Statistical methods.

Poverty.

Physical Description:

xviii, 501 p. : ill.

Edition:

1st ed.

Place of Publication:

Washington, D.C. : National Academy Press, c1995.

Language Note:

English

Summary:

Each year's poverty figures are anxiously awaited by policymakers, analysts, and the media. Yet questions are increasing about the 30-year-old measure as social and economic conditions change. In Measuring Poverty a distinguished panel provides policymakers with an up-to-date evaluation of Concepts and procedures for deriving the poverty threshold, including adjustments for different family circumstances. Definitions of family resources. Procedures for annual updates of poverty measures. The volume explores specific issues underlying the poverty measure, analyzes the likely effects of any changes on poverty rates, and discusses the impact on eligibility for public benefits. In supporting its recommendations the panel provides insightful recognition of the political and social dimensions of this key economic indicator. Measuring Poverty will be important to government officials, policy analysts, statisticians, economists, researchers, and others involved in virtually all poverty and social welfare issues.

Contents:

Measuring Poverty

Copyright

Acknowledgments

Contents

Preface

Summary and Recommendations

THE CURRENT POVERTY MEASURE: EVALUATION

RECOMMENDATION: A NEW POVERTY MEASURE

SETTING AND UPDATING THE POVERTY THRESHOLD

ADJUSTING THE THRESHOLD

DEFINING FAMILY RESOURCES

EFFECTS

NEEDED DATA

OTHER ISSUES IN POVERTY MEASUREMENT

RELATING THE POVERTY MEASURE TO ASSISTANCE PROGRAMS

1 Introduction and Overview

WHAT IS POVERTY?

THE OFFICIAL U.S. POVERTY MEASURE

Development of the Measure

Adequacy of the Current Measure

Work Patterns of Families with Children

Composition of Families and Households

Geographic Differences in Prices

Increases in Medical Care Costs and Benefits

Taxes

Provision of In-Kind Benefits

Increase in the Standard of Living

ALTERNATIVE POVERTY MEASURES AND CRITERIA FOR A MEASURE

Types of Poverty Thresholds

Absolute and Relative Thresholds

Expert Budgets: The U.S. Experience

Other Approaches

Definitions of Family Resources

Criteria for a Poverty Measure

Public Acceptability

Statistical Defensibility

Operational Feasibility

A NEW APPROACH TO POVERTY MEASUREMENT: RECOMMENDATIONS

A New Poverty Measure

Periodic Reviews

The Poverty Threshold

Updating the Thresholds

Threshold Concepts: Assessment

Recommended Threshold Concept and Updating

Setting the Initial Threshold

Adjusting the Thresholds-Equivalence Scale

Adjusting the Thresholds-Geographic Variations

Defining Family Resources

In-Kind Benefits-Nonmedical

Medical Care Costs

Work-Related Expenses

Child Support Payments

Services from Home Ownership

Assets

Effects

Distributional Effects

Effects of Selected Components

Effects on the Poverty Rate

Time Trends

Needed Data

Other Issues in Poverty Measurement.

Time Period

Unit of Analysis

Other Measures

USE OF THE POVERTY MEASURE IN GOVERNMENT PROGRAMS

The Poverty Measure and Program Eligibility

Need Standards for Programs That Use the Official Measure

Need Standards for AFDC

The Poverty Measure and AFDC Benefit Standards

2 Poverty Thresholds

THRESHOLD CONCEPTS

RECOMMENDATIONS

The Two-Adult/Two-Child Reference Family

Nondiscretionary Expenses

EXPERT BUDGETS

Multiplier Approaches

The Original U.S. Poverty Thresholds

The Orshansky Multiplier over Time

Other Multiplier Approaches

Categorical Approaches

Detailed Budget Approaches

York Family Budget Unit

BLS Family Budgets Program

Schwarz and Volgy Budget

Conclusions

Updating for Price Changes

RELATIVE THRESHOLDS

International Examples

U.S. Expert Committee on Family Budget Revisions

Issues in Deriving Relative Thresholds

Behavior of Relative Thresholds Over Time

SUBJECTIVE THRESHOLDS

Research Findings

Behavior of Subjective Thresholds Over Time

CONCLUSIONS

IMPLEMENTING THE PROPOSED APPROACH

Analysis of 1989-1991 CEX Data

The Basic Bundle

The Multiplier

The Basic Bundle and Multiplier Together

Comparison with Other Thresholds

Analysis Over Time

Further Evaluation

3 Adjusting Poverty Thresholds

ADJUSTMENTS BY FAMILY TYPE

The Concept of an Equivalence Scale

Overview and Recommendation

The Current Equivalence Scale

Alternative Equivalence Scales

Programmatic Equivalence Scales

Behavioral Scales

The Engel and Iso-Prop Methods

The Rothbarth and Other Methods

Subjective Scales

Recommended Procedure

ADJUSTMENTS BY GEOGRAPHIC AREA

Overview and Recommendations

Feasibility and Desirability.

Research Findings on Price Differences

Estimating Geographic Variations in Housing Costs

HUD Fair Market Rents

Hedonic Models

Discussion

Recommended Approach

Updating the Housing Cost Index

Further Research

4 Defining Resources

OVERVIEW AND RECOMMENDATION

ALTERNATIVES FOR DEFINING RESOURCES

Resources as Disposable Income

Adjusting Income, Not Thresholds

Recommendation

Resources as Consumption or Expenditures

Rationale

Implications

Assessment

A Crisis Definition of Resources

Methodological and Measurement Issues

PROPOSED RESOURCE DEFINITION

Money Income

Nonmedical In-Kind Benefits

Census Bureau Valuation Procedures

Assessment of Valuation Approaches

Needed Research and Development

Medical Care Needs and Resources

Proposed Approach: Recommendation

Alternative Approaches

Current Poverty Measure

Adding Health Insurance Benefits to Income

A Comprehensive Single Index

A Two-Index Poverty Measure

Separate Measures of Medical Care Risk and Economic Poverty

Census Bureau Tax Estimation Procedures

Child Care

Other Work-Related Expenses

Home Ownership Services

5 Effects of the Proposed Poverty Measure

DATA AND PROCEDURES

Poverty Measure Alternatives

Threshold Adjustments

Imputation Procedures for Proposed Resource Definition

In-Kind Benefit Values and Taxes

Out-of-Pocket Medical Care Expenditures

Child Care Expenses

Distribution of Imputed Values

RESULTS

Effects with a Constant Poverty Rate

Effects with a New Threshold

The Overall Rate

Groups

Marginal Effects

Equivalence Scale Effects

Accuracy of Medical Care Expense Imputations.

Prior Income Years

Data and Procedures

Results

Poverty Rates Using SIPP

DATA SOURCES

Recommendations

Data Sources for Income

The March CPS

The Alternative of SIPP

Orienting SIPP to Poverty Measurement

Transition

Research Recommendations

Income Data in Other Surveys

Income Data in the Decennial Census

Expenditure Data

6 Other Issues in Measuring Poverty

TIME PERIOD

Short-Term Measures

Long-Term Measures

UNIT OF ANALYSIS AND PRESENTATION

Unit of Presentation

INDEXES OF POVERTY

Alternative Indexes

Indexes with Alternative Resource Definitions

THE LIMITED SCOPE OF MEASURING ECONOMIC POVERTY

7 Use of the Poverty Measure in Government Assistance Programs

RECOMMENDATION

GOVERNMENT ASSISTANCE PROGRAMS

Overview

Determining Income Eligibility: Selected Programs

Head Start

School Nutrition Programs

WIC

Food Stamps

USING THE PROPOSED POVERTY MEASURE

The Thresholds

The Family Resource Definition

Simplified Determination of Disposable Income

Full Determination of Disposable Income

Other Issues

8 The Poverty Measure and AFDC

DETERMINING PROGRAM BENEFIT LEVELS

Proposals for AFDC Minimum Benefits: A Brief History

The Matching Formula

A Supplementary Program with a National Benefit Standard-Food Stamps

A National Minimum Benefit Standard for AFDC

Issues in Program Benefit Design

Budget Constraints

Targeting Strategies and Preferences

Program Interactions

Program Incentives

Work Effects

Family Structure Decisions

Migration Effects

Summary

Federal-State Cost Sharing

DETERMINING STATE AFDC STANDARDS OF NEED

Program Regulations

Standard Setting in the 1970s.

Standard Setting in the 1980s

Differences Among States

Differences in Need Standards and Benefits

Differences in Equivalence Scales

Trends in Need Standards and Benefits

Comparative Advantage of the Proposed Poverty Measure

Problematic Aspects of the Proposed Poverty Measure

Implications of Updating for Costs and Caseloads

Effects of Updating on Program Incentives

APPENDICES

APPENDIX A Dissent

MEASURING THE POVERTY LINE

UPDATING THE POVERTY LINE

CHOOSING A RANGE FOR THE POVERTY LINE

MEASURING FAMILY RESOURCES: THE ISSUE OF MEDICAL CARE

CONCLUSION

REFERENCES

APPENDIX B Data Sources for Measuring Poverty

MAJOR FEATURES OF THE CEX, MARCH CPS, PSID, AND SIPP

Consumer Expenditure Survey

Design and Use

Content of the Interview Survey

CPS March Income Supplement

Design

Content

Panel Study of Income Dynamics

Survey of Income and Program Participation

Summary Comparisons

Quality of Income Data

THE MARCH CPS AND SIPP COMPARED

Categories of Information

Medical Benefits/Costs

Child Care and Other Work Expenses

Asset Holdings

Ability to Support Other Estimates

Shorter or Longer Term Measures

State Estimates

Related Measures

Population Undercoverage

Household and Person Nonresponse

Item Nonresponse

Other Sources of Error

Aggregate Comparisons

APPENDIX C The Interdependence of Time and Money

''TIME IS MONEY

Illustration

RESEARCH APPROACHES

Time Poor: A Measurement

Calculating Earnings Capacity

APPENDIX D Assistance Programs for People with Low-Incomes.

PROGRAMS THAT TIE ELIGIBILITY TO THE POVERTY GUIDELINES.

Notes:

Bibliographic Level Mode of Issuance: Monograph

Includes bibliographical references (p. 449-482) and index.

ISBN:

9786610193530

9780309176842

0309176840

9781280193538

1280193530

9780309538480

0309538483

9780585022550

0585022550

OCLC:

923266519