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Chronic and Transitory Poverty over the Life Cycle

Author

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  • Joan R Rodgers

    (University of Wollongong)

  • John L. Rodgers

    (University of Wollongong)

Abstract

This study estimates chronic and transitory rates of poverty in Australia using the concept of permanent income and longitudinal data covering the period July 2001 through June 2007. We sketch a picture of chronic and transitory poverty over the life cycle by decomposing the poverty rate for the entire population into poverty rates for age categories that range from childhood, through adulthood, to old age. The measure of household income that underlies our poverty rates includes imputed rent on owner-occupied, public and rent-free housing, which has a large influence on measured poverty, particularly among older members of the population. We also document changes in chronic and transitory poverty from the period July 2001-June 2004 to the period July 2004-June 2007 and use a jack-knife procedure to test their statistical significance.

Suggested Citation

  • Joan R Rodgers & John L. Rodgers, 2010. "Chronic and Transitory Poverty over the Life Cycle," Australian Journal of Labour Economics (AJLE), Bankwest Curtin Economics Centre (BCEC), Curtin Business School, vol. 13(2), pages 117-136.
    • Handle: RePEc:ozl:journl:v:13:y:2010:i:2:p:117-136
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    References listed on IDEAS

    as
    1. Joan R. Rodgers & Peter Siminski & James Bishop, 2009. "Changes in Poverty Rates during the Howard Era," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 42(3), pages 300-320, September.
    2. Bradbury,Bruce & Jenkins,Stephen P. & Micklewright,John (ed.), 2001. "The Dynamics of Child Poverty in Industrialised Countries," Cambridge Books, Cambridge University Press, number 9780521803106.
    3. John L. Rodgers & Joan R. Rodgers, 1991. "Measuring the Intensity of Poverty among Subpopulations: Applications to the United States," Journal of Human Resources, University of Wisconsin Press, vol. 26(2), pages 338-361.
    4. Judith Yates, 1994. "Imputed Rent And Income Distribution," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 40(1), pages 43-66, March.
    5. Mark Wooden & Nicole Watson, 2007. "The HILDA Survey and its Contribution to Economic and Social Research (So Far)," The Economic Record, The Economic Society of Australia, vol. 83(261), pages 208-231, June.
    6. Peter Saunders & Peter Siminski, 2005. "Home Ownership And Inequality: Imputed Rent And Income Distribution In Australia," Economic Papers, The Economic Society of Australia, vol. 24(4), pages 346-367, December.
    7. Slesnick, Daniel T, 1993. "Gaining Ground: Poverty in the Postwar United States," Journal of Political Economy, University of Chicago Press, vol. 101(1), pages 1-38, February.
    8. Milton Friedman, 1957. "Introduction to "A Theory of the Consumption Function"," NBER Chapters, in: A Theory of the Consumption Function, pages 1-6, National Bureau of Economic Research, Inc.
    9. Joan R. Rodgers & John L. Rodgers, 1993. "Chronic Poverty in the United States," Journal of Human Resources, University of Wisconsin Press, vol. 28(1), pages 25-54.
    10. Bradbury,Bruce & Jenkins,Stephen P. & Micklewright,John (ed.), 2001. "The Dynamics of Child Poverty in Industrialised Countries," Cambridge Books, Cambridge University Press, number 9780521004923.
    11. Milton Friedman, 1957. "A Theory of the Consumption Function," NBER Books, National Bureau of Economic Research, Inc, number frie57-1, March.
    12. Susan E. Mayer & Christopher Jencks, 1989. "Poverty and the Distribution of Material Hardship," Journal of Human Resources, University of Wisconsin Press, vol. 24(1), pages 88-114.
    13. Flatau, Paul & Wood, Gavin A, 2000. "Comprehensive Income Measures, Housing Equity, and Tax-Transfer Effects," Australian Economic Papers, Wiley Blackwell, vol. 39(3), pages 327-346, September.
    14. Paul Flatau & Gavin A. Wood, 2000. "Comprehensive Income Measures, Housing Equity, and Tax‐Transfer Effects," Australian Economic Papers, Wiley Blackwell, vol. 39(3), pages 327-346, September.
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    Cited by:

    1. Roger Wilkins, 2021. "Economic Wellbeing," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 54(4), pages 469-481, December.
    2. Luigi Fabbris, Irene Sguotti, 2013. "Measuring Chronic Poverty In Italy," RIEDS - Rivista Italiana di Economia, Demografia e Statistica - The Italian Journal of Economic, Demographic and Statistical Studies, SIEDS Societa' Italiana di Economia Demografia e Statistica, vol. 67(2), pages 99-122, April-Jun.
    3. Swati Dutta & Lakshmi Kumar, 2016. "Is Poverty Stochastic or Structural in Nature? Evidence from Rural India," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 128(3), pages 957-979, September.
    4. Rafal Chomik & John Piggott, 2012. "Pensions, Ageing and Retirement in Australia: Long-Term Projections and Policies," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 45(3), pages 350-361, September.
    5. Osnat Israeli & Michal Weber, 2011. "On the contribution of the three I's of poverty to chronic and transitory poverty," Economics Bulletin, AccessEcon, vol. 31(2), pages 1496-1508.

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    More about this item

    Keywords

    Measurement and Analysis of Poverty; Welfare and Poverty: Government Programs; Provision and Effects of Welfare Programs; Welfare and Poverty: Other;
    All these keywords.

    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • I39 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Other

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