National Academies Press: OpenBook

Measuring Poverty: A New Approach (1995)

Chapter: Quality of Income Data

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Suggested Citation:"Quality of Income Data." National Research Council. 1995. Measuring Poverty: A New Approach. Washington, DC: The National Academies Press. doi: 10.17226/4759.
Page 411

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APPENDIX B 411 (e.g., whether the house is in good repair and the neighborhood is safe); ability to meet expenses for basic needs (e.g., whether the family was ever evicted for nonpayment of rent); and sources of help (e.g., how much help you could expect to get from family living nearby if you were sick). SIPP has often obtained information on health status and access to health care in topical modules. For example, Wave 3 of the 1984 panel asked about self-reported health status, days in last 4 months sick in bed, number of doctor visits in the last 12 months, and number of hospital nights in the last 12 months. Quality of Income Data A key issue in assessing the adequacy of the March CPS or the SIPP for measuring poverty is the quality of the estimates. Although some research on data quality has been done for the March CPS and considerably more research has been done for SIPP, it is not possible at this time to provide an estimate of the total error in the poverty or other income statistics from either survey. There is some comparative information available on what might be termed internal indicators of quality, such as population coverage ratios and household and item response rates, that may indicate potential problems in survey estimates. There is also some limited comparative information on aggregate statistics from the two surveys, such as the percentage of total income of various types that is captured, compared with independent sources. Such comparisons do not identify underlying components of error and must be made with care, given different definitions and procedures between the two surveys and between the surveys and other sources. Despite limitations, the available information on data quality (discussed below) shows clearly that there is reason to be concerned about the quality of income and poverty statistics from both SIPP and the March CPS. Some indicators, such as item nonresponse rates and amounts of Social Security and other income types collected, in comparison with independent estimates, favor SIPP, while other indicators, such as household nonresponse rates and amount of wages and salaries collected, in comparison with independent estimates, favor the March CPS. Overall, however, SIPP appears to be doing a somewhat better job of measuring income, particularly at the lower end of the income distribution. SIPP's more frequent interviews and detailed probing for receipt of different income sources appear to be identifying more recipients of many income types than the March CPS, although the dollar amounts reported are not always more complete in SIPP than in the CPS. Perhaps more important, SIPP is arguably in a better position to take steps to improve income quality, because of its focus on income and program participation, whereas the March CPS is necessarily constrained as an appendage to a labor force survey. Indeed, no changes to the March income supplement were even

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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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