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Escaping Poverty through Work: The Problem of Low Earnings Capacity in the United States, 1973-88


  • Haveman, Robert
  • Buron, Lawrence


This paper documents the changes in earnings capacity poverty that occurred between 1973 and 1988. Families are 'Earnings Capacity Poor' if they are unable to generate enough income to lift them out of poverty, even if all working-age adults in the family work full-time, year round. Data from the March 1974 and March 1989 Current Population Surveys indicate that earnings capacity poverty increased more rapidly than official poverty. Much of this increase can be attributed to the rise in earnings capacity poverty among whites, intact families, and family heads with more than a high school diploma. Most alarming, the percentage of children in earnings capacity poor families is considerably higher than it is among persons over eighteen; in 1988, nearly 15 percent of children under six lived in families that could not have escaped poverty even if the adults in their family were working and earning at their full capacity levels. Copyright 1993 by The International Association for Research in Income and Wealth.

Suggested Citation

  • Haveman, Robert & Buron, Lawrence, 1993. "Escaping Poverty through Work: The Problem of Low Earnings Capacity in the United States, 1973-88," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 39(2), pages 141-158, June.
  • Handle: RePEc:bla:revinw:v:39:y:1993:i:2:p:141-58

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    References listed on IDEAS

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    7. Theodore M. Crone & Leonard I. Nakamura & Richard Voith, 2010. "Rents Have Been Rising, Not Falling, in the Postwar Period," The Review of Economics and Statistics, MIT Press, vol. 92(3), pages 628-642, August.
    8. Case, Karl E & Shiller, Robert J, 1989. "The Efficiency of the Market for Single-Family Homes," American Economic Review, American Economic Association, vol. 79(1), pages 125-137, March.
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    Cited by:

    1. Marchand, J. & Smeeding, T., 2016. "Poverty and Aging," Handbook of the Economics of Population Aging, Elsevier.
      • Marchand, Joseph & Smeeding, Timothy, 2016. "Poverty and Aging," Working Papers 2016-11, University of Alberta, Department of Economics, revised 20 Nov 2016.
    2. Taryn Ann Galloway, 2004. "To What Extent Is a Transition into Employment Associated with an Exit from Poverty," Discussion Papers 382, Statistics Norway, Research Department.
    3. Sotomayor, Orlando, 2004. "Development and Income Distribution: The Case of Puerto Rico," World Development, Elsevier, vol. 32(8), pages 1395-1406, August.
    4. Timothy Smeeding & Inge O'Connor & Peter Saunders, 1994. "The Distribution of Welfare: Inequality, Earnings Capacity, and Household Production in a Comparative Perspective," LIS Working papers 122, LIS Cross-National Data Center in Luxembourg.
    5. Peter Saunders, 1994. "Immigrants and the Distribution of Income: National and International Comparisons," LIS Working papers 123, LIS Cross-National Data Center in Luxembourg.

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