Poverty and Deep Poverty

  • Kathryn Edin
  • Linda Burton
  • David Grusky

Leaders: Linda Burton, Kathryn Edin, David Grusky

The Supplemental Poverty Measure (SPM) reveals substantial post-1970 reductions in poverty under a constant (i.e., “anchored”) threshold, but this trend masks worrisome developments at the very bottom of the distribution. Although the overall SPM has trended downward since 1970, the SPM for households with less than half of the anchored threshold level (i.e., “deep poverty”) has remained stable since 1968. Even more worrying, the most extreme forms of poverty, such as living on less than $2 per day (per person), have in fact increased over the last two decades. The main tasks of our Poverty and Deep Poverty RG are to describe trends in poverty and deep poverty, to assess the effectiveness of current anti-poverty programs, and to examine the likely payoff to introducing new anti-poverty programs. We present a sampling of relevant projects below.

Frequent Reporting Project: Why are unemployment statistics reported monthly whereas poverty statistics are reported only once a year (and with such a long lag)? The CPI is hard at work solving this problem.

California Poverty Project: The CPI, in collaboration with the Public Policy Institute of California, issues the California Poverty Measure (CPM) annually. There are plans afoot to make it an even more powerful policy instrument. 

Ending Poverty in California: Is it possible to substantially reduce poverty in California by relying entirely on evidence-based programs? It indeed is.

The National Poverty StudyThe country’s one-size-fits-all poverty policy ignores the seemingly profound differences between suburban poverty, immigrant poverty, reservation poverty, rural white poverty, deindustrializing poverty, and the many other ways in which massive deprivation plays out in the U.S. The National Poverty Study, which will be the country’s first qualitative census of poverty, takes on the problem.

Income supports and deep poverty: The U.S. does not rely heavily on unconditional cash transfers in its poverty programming. Is this a mistake? The CPI is assisting Y Combinator in providing the first U.S. evidence on unconditional income support since the negative income tax experiments of the 1970s.

Disability and deep poverty: The country’s disability programs are an important anti-poverty weapon. In evaluating their effectiveness, it is important to determine whether the low employment rates among program recipients reflects an underlying (low) capacity for employment, as opposed to the labor-supply effects of the programs themselves. Although it’s long been difficult to assess such labor-supply effects, now there’s a way forward.

Evictions and deep and extreme poverty: Are evictions an important cause of deep and extreme poverty? This line of research examines the extent to which deep and extreme poverty can be reduced with a “housing first” policy that ramps up federal housing programs.

Deep poverty and TANF add-ons: The country is implicitly running hundreds of experiments on how best to structure TANF programs, but it hasn’t had the capacity to evaluate them. Are administrative data the answer?

Poverty - CPI Research

Title Author Media
Coming of Age in the Other America Stefanie DeLuca, Susan Clampet-Lundquist, Kathryn Edin

Coming of Age in the Other America

Author: Stefanie DeLuca, Susan Clampet-Lundquist, Kathryn Edin
Publisher: Russell Sage Foundation
Date: 04/2016

Recent research on inequality and poverty has shown that those born into low-income families, especially African Americans, still have difficulty entering the middle class, in part because of the disadvantages they experience living in more dangerous neighborhoods, going to inferior public schools, and persistent racial inequality. Coming of Age in the Other America shows that despite overwhelming odds, some disadvantaged urban youth do achieve upward mobility. Drawing from ten years of fieldwork with parents and children who resided in Baltimore public housing, sociologists Stefanie DeLuca, Susan Clampet-Lundquist, and Kathryn Edin highlight the remarkable resiliency of some of the youth who hailed from the nation’s poorest neighborhoods and show how the right public policies might help break the cycle of disadvantage.

Poverty and Child Development: A Longitudinal Study of the Impact of the Earned Income Tax Credit Rita Hamad, David H. Rehkopf

Poverty and Child Development: A Longitudinal Study of the Impact of the Earned Income Tax Credit

Author: Rita Hamad, David H. Rehkopf
Publisher: American Journal of Epidemiology
Date: 04/2016

Although adverse socioeconomic conditions are correlated with worse child health and development, the effects of poverty-alleviation policies are less understood. We examined the associations of the Earned Income Tax Credit (EITC) on child development and used an instrumental variable approach to estimate the potential impacts of income. We used data from the US National Longitudinal Survey of Youth (n = 8,186) during 1986–2000 to examine effects on the Behavioral Problems Index (BPI) and Home Observation Measurement of the Environment inventory (HOME) scores. We conducted 2 analyses. In the first, we used multivariate linear regressions with child-level fixed effects to examine the association of EITC payment size with BPI and HOME scores; in the second, we used EITC payment size as an instrument to estimate the associations of income with BPI and HOME scores. In linear regression models, higher EITC payments were associated with improved short-term BPI scores (per $1,000, β = −0.57; P = 0.04). In instrumental variable analyses, higher income was associated with improved short-term BPI scores (per $1,000, β = −0.47; P = 0.01) and medium-term HOME scores (per $1,000, β = 0.64; P = 0.02). Our results suggest that both EITC benefits and higher income are associated with modest but meaningful improvements in child development. These findings provide valuable information for health researchers and policymakers for improving child health and development.

Childhood Environment and Gender Gaps in Adulthood Raj Chetty, Nathaniel Hendren, Frina Lin, Jeremy Majerovitz, Benjamin Scuderi

Childhood Environment and Gender Gaps in Adulthood

Author: Raj Chetty, Nathaniel Hendren, Frina Lin, Jeremy Majerovitz, Benjamin Scuderi
Publisher: NBER
Date: 02/2016

We show that differences in childhood environments play an important role in shaping gender gaps in adulthood by documenting three facts using population tax records for children born in the 1980s. First, gender gaps in employment rates, earnings, and college attendance vary substantially across the parental income distribution. Notably, the traditional gender gap in employment rates is reversed for children growing up in poor families: boys in families in the bottom quintile of the income distributionare less likely to work than girls. Second, these gender gaps vary substantially across counties and commuting zones in which children grow up. The degree of variation in outcomes across places is largest for boys growing up in poor, single-parent families. Third, the spatial variation in gender gaps is highly correlated with proxies for neighborhood disadvantage. Low-income boys who grow up in high-poverty, high-minority areas work significantly less than girls. These areas also have higher rates of crime, suggesting that boys growing up in concentrated poverty substitute from formal employment to crime. Together, these findings demonstrate that gender gaps in adulthood have roots in childhood, perhaps because childhood disadvantage is especially harmful for boys.

State of the Union 2016: Poverty Janet C. Gornick, Markus Jäntti

State of the Union 2016: Poverty

Author: Janet C. Gornick, Markus Jäntti
Publisher:
Date: 02/2016

The well-known exceptionalism of American relative poverty extends only to rich countries, not to middle-income countries. Using a relative poverty standard for disposable household income, the U.S. poverty rate exceeds that reported in all of the other high-income countries in this study, with the sole exception of Israel. 

State of the Union 2016: Health Jason Beckfield, Katherine Morris

State of the Union 2016: Health

Author: Jason Beckfield, Katherine Morris
Publisher:
Date: 02/2016

The U.S. population is not just sicker, on average, than the European population, but also has a higher level of health inequality than the European population. The U.S. states that combine low self-rated health with high health inequality look strikingly similar—in terms of their health profiles—to Central and Eastern European countries.

poverty - CPI Affiliates

Sandra Susan Smith's picture Sandra Susan Smith Assistant Professor, Sociology
University of California, Berkeley
Alberto Diaz-Cayeros's picture Alberto Diaz-Cayeros Senior Fellow at the Center on Democracy, Development and Rule of Law (CDDRL); Director of the Center for Latin American Studies; Professor of Political Science (by courtesy)
Stanford University
Sir Tony Atkinson Deceased
University of Oxford, Nuffield College
David Neumark's picture David Neumark Founding Director, Economic Self-Sufficiency Policy Research Institute (ESSPRI); Chancellor’s Professor of Economics; Research Associate, NBER; Research Fellow, IZA; Director, Center for Economics & Public Policy
University of California, Irvine
Steven N.  Durlauf's picture Steven N. Durlauf Steans Professor of Educational Policy
University of Chicago

Pages

Poverty - Other Research

Title Author Media
Space and Unemployment: The Labor-Market Effects of Spatial Mismatch Jan K. Brueckner , Yves Zenou

Space and Unemployment: The Labor-Market Effects of Spatial Mismatch

Author: Jan K. Brueckner , Yves Zenou
Publisher: Journal of Labor Economics
Date: 01/2003
The Transition to Home Ownership and the Black-White Wealth Gap Charles, Kerwin Kofi, Erik Hurst

The Transition to Home Ownership and the Black-White Wealth Gap

Author: Charles, Kerwin Kofi, Erik Hurst
Publisher:
Date: 03/2000
From Mill Town to Board Room: The Rise of Women’s Paid Labor Dora L. Costa

From Mill Town to Board Room: The Rise of Women’s Paid Labor

Author: Dora L. Costa
Publisher: Journal of Economic Perspectives
Date: 03/2000
Black-White Differences in Wealth and Asset Composition Blau, Francine D., and John W. Graham

Black-White Differences in Wealth and Asset Composition

Author: Blau, Francine D., and John W. Graham
Publisher: Quarterly Journal of Economics
Date: 03/1989
The Working Poor: Invisible in America David K. Shipler

The Working Poor: Invisible in America

Author: David K. Shipler
Publisher: Vintage Books
Date: