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Trickling Down the Rising Tide: New Estimates of the Link between Poverty and the Macroeconomy

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  • Donald G. Freeman

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    (Department of Economics and International Business, Sam Houston State University)

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    Abstract

    This paper uses pooled time-series regressions of regional data to reexamine the link between poverty and the macroeconomy. The use of disaggregated data provides additional degrees of freedom and permits the inclusion of controls for demographic changes and increased income inequality. The results indicate a stronger relationship between poverty rates and the macroeconomy in the 1980s than that found in prior research and confirm that the dramatic reduction in unemployment during the late 1990s was instrumental in reducing poverty rates. The estimated results for the 1990s imply a 0.4–0.9% increase in the poverty rate for each 1% increase in the unemployment rate.

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    Bibliographic Info

    Article provided by Southern Economic Association in its journal Southern Economic Journal.

    Volume (Year): 70 (2003)
    Issue (Month): 2 (October)
    Pages: 359-373

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    Handle: RePEc:sej:ancoec:v:70:2:y:2003:p:359-373

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    Web page: http://www.southerneconomic.org/
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    Cited by:
    1. Gustavo A. Marrero & Juan G. Rodriguez, 2012. "Macroeconomic determinants of inequality of opportunity and effort in the US: 1970-2009," Working Papers 249, ECINEQ, Society for the Study of Economic Inequality.

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