Poverty Measurement and Trends
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Kathryn Edin
Leaders: David Betson, Kathryn Edin
The problems with official poverty measurement in the United States are legion. In an attempt to remedy many of these problems, the federal government recently released an experimental Supplemental Poverty Measure (SPM), produced by the U.S. Census Bureau in cooperation with the Bureau of Labor Statistics (BLS). The new thresholds defined under the SPM protocol equal the cost of a basket of goods, including food, clothing, shelter, utilities, and a small additional amount to allow for other needs. These thresholds are set with data from the Consumer Expenditure Survey and then adjusted to reflect the needs of different family types and geographic differences in housing costs. The main task of our Poverty Research Group is to elaborate the SPM measurement tool by (a) modifying it for the purposes of monitoring poverty at the state and sub-state levels, (b) developing a method for more frequent updating of poverty and hardship measures, (c) assessing poverty in ways that better reflect whether minimum standards of health care and child care are being met, and (d) developing a new protocol for measuring trends in the everyday experience of poverty.
Frequent Reporting Project: The CPI is building a suite of “frequent poverty measures” that will make it possible for the country to take current poverty data into account when tailoring its labor market and program policies. As it stands, the Census data used to compute annual poverty rates are released well after the year to which they pertain, thus requiring the U.S. to run its poverty policy largely in the blind. It would be considered deeply problematic, by contrast, to attempt to run the country’s employment policy with labor market data that, instead of being at most two months out of date, were approximately two years old. The Stanford Center has thus developed new frequent poverty measures using the monthly Current Population Survey (CPS). We have carried out nearly three years of research testing various specifications of these frequent measures and examining how they track the traditional poverty measure. We plan to release these measures in early 2016.
California Poverty Project: Although both the SPM and OPM are regularly used to characterize poverty at the national level, neither is well suited for the purpose of assessing (a) how poverty is changing at the state or local levels, (b) whether existing state or local policies are making much headway in reducing poverty, and (c) the extent to which new state or local proposals and initiatives would reduce poverty. The U.S. is accordingly in the untenable position of having committed itself to a decentralized policy regime without also having the capacity to measure child and adult poverty at the level at which policy is being developed and policy “experiments" are being undertaken. We have therefore undertaken to build an SPM-style poverty measure, dubbed the California Poverty Measure (CPM), in California. In collaboration with the Public Policy Institute of California (PPIC), we have so far issued two years of CPM data, and we have been analyzing those data to assist California legislators in designing poverty policy.
The National Poverty Study: The purpose of the National Poverty Study is to develop a protocol for the qualitative measurement of poverty that will allow us to measure trends in the everyday experience of poverty. Although the U.S. is doing an ever better job of counting the poor, it lacks a national infrastructure for examining how the poor live in their natural environment and how they forge their lives in the context of stress, disruption, and deprivation. We have selected 14 sites in the U.S. representing different types of poverty (e.g., deindustrializing poverty, rural poverty, border-community poverty, reservation poverty) and have developed a standardized protocol that allows us to assess cross-site differences and changes in how the poor find jobs, make ends meet, and interact with the safety net. This project is a joint undertaking with the American Institutes for Research (AIR).
Medical Expenses Project: This project proceeds from the concern that medical expenses are all too frequently “throwing families into poverty.” The objective is to examine the distribution of observed medical expenses across completely uninsured family units, partially uninsured units (e.g., a child has health insurance, but the parent does not), and fully insured units.
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Gary Solon -
Raj Chetty
Leaders: Raj Chetty, Gary Solon
The purpose of the Social Mobility RG is to develop a new infrastructure for measuring mobility that is as reliable, sound, and comprehensive as that available in other poverty and inequality domains. This RG is doing so by (a) providing comprehensive analyses of intergenerational mobility based on linked administrative data from U.S. tax returns, W-2s, and other sources, and (b) developing a new administrative infrastructure for monitoring social mobility, dubbed the American Opportunity Study.
The Equal Opportunity Project, led by Raj Chetty, uses tax return data to examine how opportunities for mobility vary across areas of the U.S. and over time. By examining families who move across areas, it is also possible to identify the causal effects of neighborhoods on opportunities, a line of analysis that has demonstrated that a child’s chances of success are strongly influenced by where that child grows up. In a second line of analysis by Pablo Mitnik, David Grusky, Michael Weber, and Victoria Bryant, an earlier sample of tax filers was exploited to secure additional estimates of mobility, with the results underlining the extent to which the family into which one is born affect opportunities to get ahead.
This research group is also developing a new administrative infrastructure for monitoring mobility and evaluating programs and policies. The American Opportunity Study (AOS) is an initiative to develop the country’s capacity (a) to link individual records across the 1960-2010 decennial censuses and the 2008-2014 American Community Surveys (ACS), (b) to append further information to these linked records from other administrative sources, (c) to make intergenerational matches between parents and children within the resulting AOS, and (d) to link to other surveys that are large enough, have individual identifiers, and for which consent to link has been obtained. This approach, which is being led by the U.S. Census Bureau, will yield a low-cost intergenerational panel based entirely on existing data. It will provide the U.S. with the capacity to monitor longitudinal processes and allow for evidence-informed policy on mobility, opportunity, and other labor market outcomes.
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David Grusky -
Kim Weeden
Leaders: David Grusky, Kim Weeden
The purpose of this research group is (a) to monitor the ongoing takeoff in income inequality, and (b) to test conventional accounts of that takeoff against newer ones that focus on market failure as a source of inequality and of the rise of a large secondary labor market of less educated workers (go here for an example of recent trend reports). The key causal question: Why is there such a large secondary market of high school dropouts even though the labor market outcomes for these workers (in terms of wages, unemployment, security) are so poor? The members of this RG have published a series of articles on this topic and have recently published a related ANNALS volume titled Living in a High Inequality Regime.
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Robert Mare
Leader: Robert Mare
The residential segregation RG is dedicated to updating the country’s system for measuring residential segregation. This RG has settled on three main research commitments: (a) monitoring segregation at the extremes; (b) charting the spatial distribution of the elderly poor; and (c) developing a new GPS-based infrastructure for measuring segregation.
Segregation at the extremes: The first line of research addresses the need to better monitor segregation at the extremes, in particular (a) the possible rise of enclave-style segregation at the very top (the “one percent”) and (b) the yet more troubling possibility of a resurgence of extreme segregation among the very poor. In a related recession brief, Robert Sampson has shown that poor neighborhoods have become yet poorer in the downturn, raising the possibility that hyper-segregation is indeed emerging.
Segregation of the elderly poor: In the second line of research, RG members are charting the spatial distribution of the elderly poor, given emerging concerns about their ghettoization. This line of research, which is being carried out in collaboration with the Stanford Center on Longevity, begins with a simple descriptive mapping of elderly poor that reveals the extent to which they are indeed isolated and segregated.
Real-time measures of segregation: The third main initiative within this RG is to develop a new infrastructure for monitoring “total interactive” segregation. The conventional approach of carrying out separate and static measurements of residential, school, work, friendship, and marriage segregation can be replaced with a direct behavioral framework that tracks the continuous-time patterning of inter-person contact. By exploiting GPS measurements (increasingly available, even for the poor, via mobile phones), it becomes possible to track poor, middle-class, and rich people as they move through their day and attend school, go to work, carry out their shopping, and visit friends and family. This methodology will produce a real-time measure of how much segregation there is and, in particular, the extent to which the poor are growing increasingly isolated in school, home, work, and leisure.
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Michael Hout
Leader: Michael Hout
The Recession & Recovery RG examines the social effects of the Great Recession and subsequent recovery on poverty and inequality. The website for this project delivers expert scholarship on the social and economic fallout of the downturn as well as a graphing utility that allows scholars, journalists, and the general public to access trend data on the effects of the recession. The 2014, 2015, and 2016 State of the Union Reports distill the results from this monitoring and reporting exercise. This RG is also exploiting the General Social Survey (GSS) panel data and other sources to examine recession effects on attitudes toward redistribution, confidence in institutions, and other outcomes.
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Karen Jusko -
Mark Duggan
Leaders: Mark Duggan, Karen Jusko
The Safety Net RG is devoted to monitoring changes in government and nongovernment transfers to the poor and assessing whether these programs are meeting the needs of the poor. This RG is critical because transfers are playing an important role in reducing hardship as nonworking poverty continues to rise. We are working on two main projects within this RG: (a) a study of state-by-state variation in safety net and transfer programs; (b) developing and maintaining an archive of research and data on poverty in California (www.c-well.org); and (c) examining the effects of social programs on individual and firm behavior.
Poverty Relief Project: This project, led by Stanford political science professor Karen Jusko, develops a new measure of the effectiveness of cash-based poverty relief programs. The "poverty relief ratio" provides an estimate of the extent of redistribution relative to what would be required to bring all low-income households to a well-defined poverty line. With Kate Weisshaar, Jusko uses the poverty relief ratio to evaluate, over the last 25 years, the effectiveness of antipoverty programs at the national and state level. The first set of national and state-level results were released in our 2014 and 2015 State of the Union reports. This new measure will continue to be developed, applied, and disseminated in further research projects.
California Welfare Laboratory: The Safety Net RG, in collaboration with Charles Varner and Pablo Mitnik, is also responsible for building and maintaining the California Welfare Laboratory (www.c-well.org). The threefold purpose of the California Welfare Laboratory is (1) to host a research database on California’s welfare programs; (2) to disseminate new research on welfare-relevant topics within California; and (3) to allow scholars, county welfare administrators, and the general public to monitor recent trends in poverty and welfare usage. The mission of the laboratory is to make research on California’s welfare programs accessible to all and thus facilitate an informed discussion of what is working and what needs to be improved.
Behavioral Effects: In a third stream of research led by Mark Duggan, the focus shifts to the effect of government expenditure programs, such as Social Security, Medicare, and Medicaid, on the behavior of individuals and firms. This research program also explores the effect of federal disability programs on labor market outcomes (go here for example).
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Doug Massey -
David Grusky
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Tomás Jiménez -
Beth Mattingly
Leaders: David Grusky, Tomás Jiménez, Doug Massey, Beth Mattingly
This RG was created after the CPI received a sub-award to study Hispanic poverty, inequality, and mobility. The objective is to document key poverty and inequality trends, to begin the task of explaining what underlies them, and to then populate a new website, with the results coming out of this research.
We are taking on five lines of research under the leadership of both young and more distinguished scholars. The “basic trends” group is documenting key developments in Hispanic population distribution, income, education, poverty, employment, and “safety net” use; the “new generations” group is examining whether second and third generation immigrants are successfully incorporating into the labor market; the “social mobility” group is assessing whether Hispanics continue to have ample opportunities to improve their economic situation during their lifetime; the “social policy” group is examining how recent legal and policy changes have affected Hispanic natives and immigrants; and the “health” group is exploring the sources of deteriorating health among Hispanic immigrants and natives. The work of this RG was featured in a Pathways Magazine special report on poverty, inequality, and mobility among Hispanics.
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Sean Reardon
Leaders: Sean Reardon. Michelle Jackson
The purpose of the Education RG is to examine trends in the extent to which educational access and achievement are related to poverty and family background. This agenda is being pursued by (a) monitoring changes in the effects of poverty and family background on academic achievement, and (b) decomposing the total effects of background into a component pertaining to effects on performance (“primary effects”) and a component pertaining to effects on choices (“secondary effects”).
The scholars working within this RG are now examining state-level differences in the effects of social origins, uncovering the causes of the recent rise in the socioeconomic achievement gap, uncovering the causes of the yet more recent turnaround in this rise (among kindergarten children), and examining the ways in which high-achieving children from poor backgrounds can be induced to go to college. At our 2015 State of the Union event, a research brief on inter-state differences in racial and socioeconomic educational inequality was presented, with the brief showing that these differences are substantial.
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C. Matthew Snipp -
Daniel Lichter
Leaders: C. Matthew Snipp, Daniel Lichter
This RG is charged with tracking how the economic circumstances of U.S. ethnic and racial groups have evolved. It is striking that a quite basic monitoring of the size of such racial and ethnic gaps is not regularly undertaken and has not been part of our standard set of social indicators. In addressing this deficit, the members of this RG are using ACS data to monitor trends in these gaps, thus making it possible to provide measures for relatively small geographic areas.
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Shelley Correll -
Cecilia Ridgeway
Leaders: Shelley Correll, Cecilia Ridgeway
The Poverty and Discrimination RG is charged with developing a regularized protocol for measuring the amount and extent of discrimination in labor and housing markets. It is increasingly clear that labor market discrimination, far from withering away, remains very prominent for many statuses and in many types of markets. However, because this research tradition is based on “one-off” audit studies and laboratory experiments, it is not possible to compare across studies and assess which types of discrimination are the most important or the most resistant to change. There is accordingly a need to build a standardized protocol for monitoring trends in discrimination across the various types of discrimination in play (e.g., poverty status, employment status, homelessness, economic background, race, ethnicity, sexual orientation, incarceration status, citizenship, religion, disability). The twofold objective of this protocol is to make it possible to assess which types of discrimination are especially prominent and which types are growing weaker or stronger over time.
Featured Examples
All - CPI Research
| Title | Author | Media | |
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| The Continuing Increase in Income Segregation, 2007-2012 | Sean Reardon, Kendra Bischoff |
The Continuing Increase in Income Segregation, 2007-2012Author: Sean Reardon, Kendra BischoffPublisher: Date: 03/2016 In this report, we use the most recent data from the American Community Survey to investigate whether income segregation increased from 2007 to 2012. These data indicate that income segregation rose modestly from 2007 to 2012. This continues the trend of rising income segregation that began in the 1980s. We show that the growth in income segregation varies among metropolitan areas, and that segregation increased rapidly in places that experienced large increases in income inequality. This suggests that rising income inequality continues to be a key factor leading to increasing residential segregation by income. |
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| Childhood Environment and Gender Gaps in Adulthood | Raj Chetty, Nathaniel Hendren, Frina Lin, Jeremy Majerovitz, Benjamin Scuderi |
Childhood Environment and Gender Gaps in AdulthoodAuthor: Raj Chetty, Nathaniel Hendren, Frina Lin, Jeremy Majerovitz, Benjamin ScuderiPublisher: NBER Date: 02/2016 We show that differences in childhood environments play an important role in shaping gender gaps in adulthood by documenting three facts using population tax records for children born in the 1980s. First, gender gaps in employment rates, earnings, and college attendance vary substantially across the parental income distribution. Notably, the traditional gender gap in employment rates is reversed for children growing up in poor families: boys in families in the bottom quintile of the income distributionare less likely to work than girls. Second, these gender gaps vary substantially across counties and commuting zones in which children grow up. The degree of variation in outcomes across places is largest for boys growing up in poor, single-parent families. Third, the spatial variation in gender gaps is highly correlated with proxies for neighborhood disadvantage. Low-income boys who grow up in high-poverty, high-minority areas work significantly less than girls. These areas also have higher rates of crime, suggesting that boys growing up in concentrated poverty substitute from formal employment to crime. Together, these findings demonstrate that gender gaps in adulthood have roots in childhood, perhaps because childhood disadvantage is especially harmful for boys. |
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| State of the Union 2016: Poverty | Janet C. Gornick, Markus Jäntti |
State of the Union 2016: PovertyAuthor: Janet C. Gornick, Markus JänttiPublisher: Date: 02/2016 The well-known exceptionalism of American relative poverty extends only to rich countries, not to middle-income countries. Using a relative poverty standard for disposable household income, the U.S. poverty rate exceeds that reported in all of the other high-income countries in this study, with the sole exception of Israel. |
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| State of the Union 2016: Residential Segregation | Daniel T. Lichter, Domenico Parisi, Helga de Valk |
State of the Union 2016: Residential SegregationAuthor: Daniel T. Lichter, Domenico Parisi, Helga de ValkPublisher: Date: 02/2016 Segregation often overlaps with many other place-based inequalities—poverty, unemployment, crime, and housing quality and overcrowding. These overlapping disadvantages are seemingly much more common in the U.S. than in European countries, where government efforts to promote integration provide a clear contrast to the market-driven solutions preferred in the U.S. |
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| State of the Union 2016: Health | Jason Beckfield, Katherine Morris |
State of the Union 2016: HealthAuthor: Jason Beckfield, Katherine MorrisPublisher: Date: 02/2016 The U.S. population is not just sicker, on average, than the European population, but also has a higher level of health inequality than the European population. The U.S. states that combine low self-rated health with high health inequality look strikingly similar—in terms of their health profiles—to Central and Eastern European countries. |
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All - CPI Working Papers
| Title | Author | Media | |
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| Explaining the Gender Gap in Charitable Giving | Robb Willer, Christopher Wimer, Lindsay A. Owens |
Explaining the Gender Gap in Charitable GivingAuthor: Robb Willer, Christopher Wimer, Lindsay A. OwensPublisher: Date: 01/2015 Relative to other industrialized, Western nations, the United States is uniquely reliant on nongovernmental organizations to provide public goods, including relief services for the poor. Research on charitable provision, however, finds a consistent gender gap in Americans' giving, with women bearing a significantly greater share of the burden than men. Here we investigate what explains gender differences in giving and what can counteract the pattern by increasing men's giving. |
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| The Old Jim Crow: Racial Residential Segregation and Neighborhood Imprisonment | Traci Burch |
The Old Jim Crow: Racial Residential Segregation and Neighborhood ImprisonmentAuthor: Traci BurchPublisher: Stanford Center on Poverty and Inequality Date: 04/2014 Mass imprisonment is one of the most important policy changes the United States has seen in the past forty years. In 2011, 1.6 million people, or 1 in 200 adults, in the U.S. were in prison (Guerino, Harrison, and Sabol 2011). Understanding the factors that affect neighborhood imprisonment rates is particularly important for improving the quality of life in disadvantaged communities. This paper examines the impact of one such factor, racial residential segregation, on imprisonment rates at the neighborhood level. |
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| Tax Structure and Revenue Instability: The Great Recession and the States | Howard Chernick, Cordelia Reimers, Jennifer Tennant |
Tax Structure and Revenue Instability: The Great Recession and the StatesAuthor: Howard Chernick, Cordelia Reimers, Jennifer TennantPublisher: IZA Journal of Labor Policy Date: 02/2014 The Great Recession had the most severe impact on state tax revenues of any downturn since the Great Depression. We hypothesize that states with more progressive tax structures are more vulnerable to economic downturns, and that progressivity and income volatility may interact to amplify the recession’s fiscal impact. We find that, while potential revenue exposure is greater in more progressive states, the most important source of variation was differences in income concentration and capital gains shares in the top 5 percent of taxpayers. Though the interaction between income volatility and high tax burdens at the top did produce large decreases in tax revenue in a few states, tax progressivity accounted for little of the overall interstate variation in revenue volatility. |
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| Who Enters Teaching? Encouraging Evidence that the Status of Teaching is Improving | Hamilton Lankford, Susanna Loeb, Andrew McEachin, Luke C. Miller, James Wyckoff |
Who Enters Teaching? Encouraging Evidence that the Status of Teaching is ImprovingAuthor: Hamilton Lankford, Susanna Loeb, Andrew McEachin, Luke C. Miller, James WyckoffPublisher: Date: 01/2014 The relatively low status of teaching as a profession is often given as a factor contributing to the difficulty of recruiting teachers, the middling performance of American students on international assessments, and the well-documented decline in the relative academic ability of teachers through the 1990s. Since the turn of the 21st century, however, a number of federal, state, and local teacher accountability policies have been implemented toward improving teacher quality over the objections of some who argue the policies will decrease quality. In this paper we analyze 25 years of data on the academic ability of teachers in New York State and document that since 1999 the academic ability of both individuals certified and those entering teaching has steadily increased. These gains are widespread and have resulted in a substantial narrowing of the differences in teacher academic ability between high and low poverty schools and between white and minority teachers. We interpret these gains as evidence that the status of teaching is improving. |
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| Impact of the Great Recession and Beyond: Disparities in Wealth Building by Generation and Race | Signe-Mary McKernan, Caroline Ratcliffe, Eugene Steuerle, Sisi Zhang |
Impact of the Great Recession and Beyond: Disparities in Wealth Building by Generation and RaceAuthor: Signe-Mary McKernan, Caroline Ratcliffe, Eugene Steuerle, Sisi ZhangPublisher: Date: 12/2013 This paper uses over two decades of Survey of Consumer Finances data and a pseudo-panel technique to measure the impact of the Great Recession on wealth relative to the counterfactual of what wealth would have been given wealth accumulation trajectories. Our regression-adjusted synthetic cohort-level models find that the Great Recession reduced the wealth of American families by 28.5 percent—nearly double the magnitude of previous pre-post mean descriptive estimates and double the magnitude of any previous recession since the 1980s. The housing market was only part of the story; all major wealth components fell as a result of the Great Recession. |
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All - Other Research
| Title | Author | Media | |
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| 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 PovertyAuthor: Sanders Korenman, Dahlia K. RemlerPublisher: 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. |
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| Car and Home Ownership Among Low-Income Families in the Great Recession | Laurel Sariscsany |
Car and Home Ownership Among Low-Income Families in the Great RecessionAuthor: Laurel SariscsanyPublisher: Russell Sage Foundation Date: 12/2015 In a recent paper, Columbia University's Valentina Duque, Natasha Pilkauskas, and Irwin Garkfinkel analyzed the association between the Great Recession and assets among families with children. The study revealed two key findings. First, the recession led to declines in home and car ownership among families of young children. And second, more vulnerable groups — single, cohabiting, Black, and Hispanic families — were most likely to feel these effects, with married or White mothers more likely to be protected. |
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| An Opportunity Agenda for Renters | David Sanchez, Tracey Ross, Julia Gordon |
An Opportunity Agenda for RentersAuthor: David Sanchez, Tracey Ross, Julia GordonPublisher: Center for American Progress Date: 12/2015 This report provides an overview of the latest research that demonstrates how people’s address effects their life outcomes. The report also outlines several policies to promote economic opportunity for America’s low-income renters. |
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| The Great Recession and State Criminal Justice Policy: Do Economic Hard Times Matter? | Peter K. Enns, Delphia Shanks-Booth |
The Great Recession and State Criminal Justice Policy: Do Economic Hard Times Matter?Author: Peter K. Enns, Delphia Shanks-BoothPublisher: Russell Sage Foundation Date: 12/2015 It costs a lot to maintain the world's highest incarceration rate. Did the largest economic shock since the Great Depression influence criminal justice policy and resulting incarcerations? |
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| The Great Recession and Mothers' Health | Christopher Wimer |
The Great Recession and Mothers' HealthAuthor: Christopher WimerPublisher: Russell Sage Foundation Date: 10/2015 Given the now well known effects of the Great Recession on economic outcomes of individuals and families, researchers have turned to the question of how this major economic downturn affected domains of family life. In a recent paper, Janet Currie of Princeton University and Valentina Duque and Irwin Garfinkel of Columbia University study the health of young mothers in the context of the Great Recession. Two key findings emerged. First, increased unemployment was associated with worsened self-reported health status and increased smoking and drug use. Second, more disadvantaged mothers suffered the greatest effects for self-reported health, while more advantaged mothers sometimes showed improvements in their health and health behaviors in response to the recession. |
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