National Academies Press: OpenBook

Measuring Poverty: A New Approach (1995)

Chapter: Transition

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Suggested Citation:"Transition." National Research Council. 1995. Measuring Poverty: A New Approach. Washington, DC: The National Academies Press. doi: 10.17226/4759.
Page 287

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EFFECTS OF THE PROPOSED POVERTY MEASURE 287 estimated that as many as 20 percent of black men are missed in the March CPS and SIPP, relative to the population counted in the decennial census. Undercoverage rates are even higher for young black men (Citro and Kalton, 1993: Table 3-12; see also Appendix B). The Census Bureau has initiated a program of coverage research to better understand coverage problems and develop effective countermeasures (Shapiro and Bettin, 1992), and we urge that this work go forward. We note, however, that household surveys, by their nature, overlook some population groups, including the homeless and people in institutions. The decennial population census (see below) includes these groups, although coverage is far from complete. Transition We are reasonably confident that use of SIPP data will show the same effects of the proposed poverty measure as shown in the March CPS, with the exception of lower overall rates. However, its use as the official source of poverty statistics represents another change in addition to the significant changes that we propose in the measure itself. To aid in making the transition and to help evaluate the SIPP-based estimates, it would be helpful for the Census Bureau to produce, for some period, concurrent time series of poverty rates from the March CPS and SIPP by using the proposed revised thresholds (updated each year with new CEX data) and the proposed disposable income resource definition. Admittedly, the construction of disposable income with the March CPS is complicated by the necessity for extensive imputations: in addition to imputation procedures for taxes and nonmedical in-kind benefits that already exist, the Census Bureau would need to develop imputation procedures for out-of-pocket medical expenditures, child care expenses, and child support payments.27 However, we believe that such procedures can be developed, using data from such sources as SIPP and NMES, and that it would be very useful for researchers and policy analysts to have concurrent series. Any imputations that are performed, whether on the March CPS or SIPP, should be evaluated as to their quality and the sensitivity of the resulting poverty rates to the form of the imputation. The concurrent series should be developed going forward from 1996 when the new SIPP design is implemented, and also going backward to 1984 when SIPP was first introduced. In the case of the latter estimates, some imputations will be required for SIPP as well as for the March CPS; also, small sample size for many SIPP panels will be a problem. Nevertheless, the 27 For child support payments, adequate imputations will require the addition of a question to the March CPS that asks whether families provide support to children outside their household (ideally, the question would ask the amount as well, obviating the need for an imputation procedure).

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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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