National Academies Press: OpenBook

Measuring Poverty: A New Approach (1995)

Chapter: Statistical Defensibility

« Previous: Criteria for a Poverty Measure
Suggested Citation:"Statistical Defensibility." National Research Council. 1995. Measuring Poverty: A New Approach. Washington, DC: The National Academies Press. doi: 10.17226/4759.
Page 38

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INTRODUCTION AND OVERVIEW 38 and level for the official U.S. poverty measure, in addition to what can be learned from science: public acceptability; statistical defensibility; and operational feasibility. We have been guided by these three in our deliberations and in the formation of our recommendations. Public Acceptability Public acceptability is both a demanding and a lenient criterion. One of the key reasons that the SSA measure of poverty became quickly and broadly acceptable as the "official" measure in the early 1960s was that there was, for whatever reason, broad consensus that a level of income of about $3,000 was then a sensible cutoff for the threshold for poverty in the United States. A concept—then or now—that varies greatly from a generally accepted intuitive notion of what constitutes poverty would probably fail to gain political acceptance. But this criterion demands that there be some rationale that has face validity. Just proclaiming a number—for example, the income level $10,000 as the benchmark for poverty—is not useful and would not become influential as a benchmark or policy guide. There should be some underlying sense to the concept, some reasonable explanation that is persuasive. The measure should be understandable and broadly acceptable. The general public may not care to understand details about the calculation of components of the measure (e.g., the equivalence scale computations), but the basic notion that the poverty measure reflects should accord with common sense. Statistical Defensibility Statistical defensibility, or statistical integrity, is an important criterion partly because the measure will be used by analysts and policy makers, and the technical details of its computation must meet the accepted standards of those analysts and of the many scholars who conduct research on the issue of poverty. Any newly proposed concept or method will be scrutinized and assessed before it becomes widely accepted, and it must withstand this demanding test. The measure must be logically consistent. One of the central complaints against the current measure, as we note throughout this report, is that the poverty threshold is an after-tax concept, but the annual computation of the proportion and characteristics of people in poverty uses a before-tax family resource definition; this does not make sense. More subtly, a poverty measure must allow for reasonable comparative analyses (within the limits of available data) across time, across places, across types of families, and across population groups. Analysts and policy makers want to be able to say something about the incidence of poverty compared

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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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