National Academies Press: OpenBook

Measuring Poverty: A New Approach (1995)

Chapter: Nonmedical In-Kind Benefits

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Suggested Citation:"Nonmedical In-Kind Benefits." National Research Council. 1995. Measuring Poverty: A New Approach. Washington, DC: The National Academies Press. doi: 10.17226/4759.
Page 219

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DEFINING RESOURCES 219 child support, alimony, interest on savings accounts, and dividends. SIPP asks about more than 60 separate sources of money income (see Appendix B). Nonmedical In-Kind Benefits Both the concept that underlay the original official poverty thresholds and the concept that we propose represent budgets for family consumption needs. Given such a concept, the resource definition should add to money income the value of near-money in-kind benefits that are intended to support consumption. Indeed, there is virtually unanimous support in the research community for this position: see, for example, the comments of Ellwood and Summers (1985), Blinder (1985), and Rees (1985) at a Conference on the Measurement of Noncash Benefits sponsored by the Census Bureau. At the time the current poverty measure was adopted, such programs as food stamps and public housing provided benefits to relatively few families. Since then, they have made important contributions to reducing material hardship in the United States, and it makes no sense for their contributions to be ignored in the official poverty measure. We refer here to nonmedical in-kind benefits; the next section considers medical care benefits and out-of-pocket medical care costs. A major issue concerns the best method to assign an appropriate value to nonmedical in-kind benefits, given that recipients may not value them as highly as the equivalent amount of cash. The Census Bureau in its work over the past decade to develop experimental estimates of poverty based on an adjusted income measure has wrestled with the issue of valuation. We review the approaches that the Census Bureau has adopted at various times and suggest areas for research.15 Another issue is which types of benefits to include. The Census Bureau's work to date has covered food stamps, public and subsidized housing, and regular and subsidized school lunches. Benefits from the Low-Income Home Energy Assistance Program (LIHEAP), the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC), and the School Breakfast Program, which are covered in SIPP but not in the March CPS, also seem prime candidates to include. For many other types of in-kind benefits (e.g., Meals on Wheels and other food programs for the elderly and free or subsidized meals or housing from employers), there are limited or no available data and no experience with valuation. A recommendation by the Panel to Evaluate the Survey of Income and Program Participation (Citro and Kalton, 1993:79-80,83) that SIPP use one or more of its topical modules to examine the range of in-kind programs and identify those that may be sufficiently widespread to warrant regular measurement may be the place to start. The value of employer-provided in-kind benefits that are necessary for 15 Smeeding (1982) initiated the work at the Census Bureau to value in-kind benefits.

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Measuring Poverty: A New Approach Get This Book
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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.

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