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
State of the Union 2019: Social Networks Mario L. Small, Maleah Fekete

State of the Union 2019: Social Networks

Author: Mario L. Small, Maleah Fekete
Publisher: Stanford Center on Poverty and Inequality
Date: 06/2019
  • Millennials spend at least as much time with relatives or friends, and hanging out at bars, as preceding generations. 
  • This commitment to relatively high rates of face-to-face interaction continues even as millennials use social media at unprecedented rates. 
  • The millennial generation—unlike previous ones—has all but closed the digital divide between poor and nonpoor.
State of the Union 2019: Poverty and the Safety Net Marybeth Mattingly, Christopher Wimer, Sophie Collyer, Luke Aylward

State of the Union 2019: Poverty and the Safety Net

Author: Marybeth Mattingly, Christopher Wimer, Sophie Collyer, Luke Aylward
Publisher: Stanford Center on Poverty and Inequality
Date: 06/2019
  • Although there is much worry about millennials’ well-being, their poverty rates at age 30 are no higher than those of Gen Xers at the same age. 
  • But millennials do have very high poverty rates before the safety net takes effect by supplementing market income. Robust tax credit and transfer programs have staved off what would otherwise be an increase in poverty relative to prior generations.
Local Food Prices, SNAP Purchasing Power, and Child Health Erin T. Bronchetti, Garret S. Christensen, Hilary W. Hoynes

Local Food Prices, SNAP Purchasing Power, and Child Health

Author: Erin T. Bronchetti, Garret S. Christensen, Hilary W. Hoynes
Publisher: NBER
Date: 06/2018

The Supplemental Nutrition Assistance Program (SNAP, formerly food stamps) is one of the most important elements of the social safety net. Unlike most other safety net programs, SNAP varies little across states and over time, which creates challenges for quasi-experimental evaluation. Notably, SNAP benefits are fixed across 48 states; but local food prices vary, leading to geographic variation in the real value – or purchasing power – of SNAP benefits. In this study, we provide the first estimates that leverage variation in SNAP purchasing power across markets to examine effects of SNAP on child health. We link panel data on regional food prices to National Health Interview Survey data and use a fixed effects framework to estimate the relationship between local purchasing power of SNAP and children’s health and health care utilization. We find that lower SNAP purchasing power leads to lower utilization of preventive health care and more days of school missed due to illness. We find no effect on reported health status.

State of the Union 2018: Poverty H. Luke Shaefer, Marybeth Mattingly, Kathryn Edin

State of the Union 2018: Poverty

Author: H. Luke Shaefer, Marybeth Mattingly, Kathryn Edin
Publisher: Stanford Center on Poverty and Inequality
Date: 03/2018

Under the official poverty measure, the poverty rate for women is higher than that for men, although this gender gap shrank slightly in the 1990s. The gender gap in poverty is evident for all gradations of poverty. The share of women in deep poverty, regular poverty, and near poverty is greater than the corresponding share of men. Women also experience higher levels of food insecurity.

Convergence and Disadvantage in Poverty Trends (1980–2010): What is Driving the Relative Socioeconomic Position of Hispanics and Whites? Marybeth J. Mattingly, Juan M. Pedroza

Convergence and Disadvantage in Poverty Trends (1980–2010): What is Driving the Relative Socioeconomic Position of Hispanics and Whites?

Author: Marybeth J. Mattingly, Juan M. Pedroza
Publisher: Race and Social Problems
Date: 03/2018

The gap between white and Hispanic poverty has remained stable for decades despite dramatic changes in the size and composition of the two groups. The gap, however, conceals crucial differences within the Hispanic population whereby some leverage education and smaller families to stave off poverty while others facing barriers to citizenship and English language acquisition face particularly high rates. In this paper, we use Decennial Census and American Community Survey data to examine poverty rates between Hispanic and non-Hispanic, white heads of household. We find the usual suspects stratify poverty risks: gender, age, employment, education, marital status, family size, and metro area status. In addition, Hispanic ethnicity has become a weaker indicator of poverty. We then decompose trends in poverty gaps between racial and ethnic groups. Between 1980 and 2010, poverty gaps persisted between whites and Hispanics. We find support for a convergence of advantages hypothesis and only partial support (among Hispanic noncitizens and Hispanics with limited English language proficiency) for a rising disadvantages hypothesis. Poverty-reducing gains in educational attainment alongside smaller families kept white–Hispanic poverty gaps from rising. If educational attainment continues to rise and family size drops further, poverty rates could fall, particularly for Hispanics who still have lower education and larger families, on average. Gains toward citizenship and greater English language proficiency would also serve to reduce the Hispanic–white poverty gap.

poverty - CPI Affiliates

David Grusky's picture David Grusky Faculty Director, Center on Poverty and Inequality; Professor of Sociology
Stanford University
Kathryn Edin's picture Kathryn Edin Poverty Research Group Leader, Professor of Sociology and Public Affairs
Princeton University
Linda Burton's picture Linda Burton Poverty Research Group Leader, Dean of the Social Sciences
Duke University
Arloc Sherman's picture Arloc Sherman Senior Fellow
Center on Budget and Policy Priorities
Christopher Jencks's picture Christopher Jencks Malcolm Wiener Professor of Social Policy, Emeritus
Harvard University

Pages

Poverty - Other Research

Title Author Media
The Changing Safety Net for Low-Income Parents and Their Children: Structural or Cyclical Changes in Income Support Policy? Bradley Hardy, Timothy Smeeding, James P. Ziliak

The Changing Safety Net for Low-Income Parents and Their Children: Structural or Cyclical Changes in Income Support Policy?

Author: Bradley Hardy, Timothy Smeeding, James P. Ziliak
Publisher: Demography
Date: 01/2018

Refundable tax credits and food assistance are the largest transfer programs available to able-bodied working poor and near-poor families in the United States, and simultaneous participation in these programs has more than doubled since the early 2000s. To understand this growth, we construct a series of two-year panels from the 1981–2013 waves of the Current Population Survey Annual Social and Economic Supplement to estimate the effect of state labor-market conditions, federal and state transfer program policy choices, and household demographics governing joint participation in food and refundable tax credit programs. Overall, changing policy drives much of the increase in the simultaneous, biennial use of food assistance and refundable tax credits. This stands in stark contrast from the factors accounting for the growth in food assistance alone, where cyclical and structural labor market factors account for at least one-half of the growth, and demographics play a more prominent role. Moreover, since 2000, the business cycle factors as the leading determinant in biennial participation decisions in food programs and refundable tax credits, suggesting a recent strengthening in the relationship between economic conditions and transfer programs.

The Supplemental Poverty Measure: 2016 Liana Fox

The Supplemental Poverty Measure: 2016

Author: Liana Fox
Publisher: U.S. Census Bureau
Date: 09/2017

In 2016, the overall SPM rate was 13.9 percent. This was 0.6 percentage points lower than the 2015 SPM rate of 14.5 (Figure 1 and Figure 2).

SPM rates were down for children under age 18 and adults aged 18 to 64. SPM rates for individuals aged 65 and older were up, from 13.7 percent in 2015 to 14.5 percent in 2016 (Figure 1 and Figure 2).

The SPM rate for 2016 was 1.2 percentage points higher than the official poverty rate of 12.7 percent (Figure 3).

The percentage of individuals aged 65 and older with SPM resources below half their SPM threshold increased from 4.5 percent in 2015 to 5.2 percent in 2016 (Figure 6 and Appendix Table A-4).

There were 13 states plus the District of Columbia for which SPM rates were higher than official poverty rates, 20 states with lower rates, and 17 states for which the differences were not statistically significant (Figure 7).

Social Security continued to be the most important anti-poverty program, moving 26.1 million individuals out of poverty. Refundable tax credits moved 8.2 million people out of poverty (Figure 8).

Income and Poverty in the United States: 2016 Jessica L. Semega, Kayla R. Fontenot, Melissa A. Kollar

Income and Poverty in the United States: 2016

Author: Jessica L. Semega, Kayla R. Fontenot, Melissa A. Kollar
Publisher: U.S. Census Bureau
Date: 09/2017

Summary of findings:

Real median household income increased 3.2 percent between 2015 and 2016.2 This is the second consecutive annual increase in median household income.

The number of full-time, year-round workers increased by 2.2 million in 2016.

The 2016 female-to-male earnings ratio was 0.805, a 1.1 percent increase from the 2015 ratio. This is the first time the female-to-male earnings ratio has experienced an annual increase since 2007.

The official poverty rate decreased by 0.8 percentage points between 2015 and 2016. At 12.7 percent, the 2016 poverty rate is not statistically different from 2007 (12.5 percent), the year before the most recent recession.

The number of people in poverty fell by 2.5 m

Including Health Insurance in Poverty Measurement: The Impact of Massachusetts Health Reform on Poverty Sanders Korenman, Dahlia K. Remler

Including Health Insurance in Poverty Measurement: The Impact of Massachusetts Health Reform on Poverty

Author: Sanders Korenman, Dahlia K. Remler
Publisher: NBER
Date: 02/2016

We develop and implement what we believe is the first conceptually valid health-inclusive poverty measure (HIPM)—a measure that includes health care or insurance in the poverty needs threshold and health insurance benefits in family resources—and we discuss its limitations. Building on the Census Bureau’s Supplemental Poverty Measure, we construct a pilot HIPM for the under-65 population under ACA-like health reform in Massachusetts. This pilot is intended to demonstrate the practicality, face validity and value of a HIPM. Results suggest that public health insurance benefits and premium subsidies accounted for a substantial, one-third reduction in the poverty rate. Among low-income families who purchased individual insurance, premium subsidies reduced poverty by 9.4 percentage points.

Are Latino Immigrants a Burden to Safety Net Services in Non-Traditional Immigrant States? Lessons from Oregon Daniel López-Cevallos

Are Latino Immigrants a Burden to Safety Net Services in Non-Traditional Immigrant States? Lessons from Oregon

Author: Daniel López-Cevallos
Publisher: American Journal of Public Health
Date: 12/2013

The significant growth of the Latino population in the midst of an economic recession has invigorated anti-Latino, anti-immigrant sentiments in many US states. One common misconception is that Latino immigrants are a burden to safety net services. This may be particularly true in nontraditional immigrant states that have not historically served Latino immigrants. Oregon data suggest that despite a higher prevalence of poverty, use of safety net services among Latino immigrants in Oregon is lower than that among non-Latino Whites. Immigration status, costs, lack of insurance coverage, and discrimination are among the reasons for this group’s limited use of services. Nevertheless, policies designed to strengthen community and institutional support for Latino immigrant families should be considered in the context of current health care and immigration reform efforts.