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Reconciliation of income and consumption data in poverty measurement

  • Richard Bavier

    (Office of Management and Budget, Washington, DC)

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    A recent series of papers has renewed interest in the question of whether consumption data are superior to income data for poverty measurement. Although the Census Bureau has provided researchers with an experimental series of variables that can produce a comprehensive income measure, this resource has not been fully exploited in previous analyses. When poverty is measured by a comprehensive income measure, income poverty rates and trends are similar to consumption poverty rates. Arguments that income is measured with more error than consumption at the bottom of the distribution are shown to be based upon inferior income data. © 2008 by the Association for Public Policy Analysis and Management.

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    Article provided by John Wiley & Sons, Ltd. in its journal Journal of Policy Analysis and Management.

    Volume (Year): 27 (2008)
    Issue (Month): 1 ()
    Pages: 40-62

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    Handle: RePEc:wly:jpamgt:v:27:y:2008:i:1:p:40-62
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    1. David M. Cutler & Lawrence F. Katz, 1991. "Macroeconomic Performance and the Disadvantaged," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 22(2), pages 1-74.
    2. Kerwin Kofi Charles & Sheldon Danziger & Geng Li & Robert F. Schoeni, 2006. "Studying consumption with the Panel Study of Income Dynamics: comparisons with the Consumer Expenditure Survey and an application to the intergenerational transmission of well-being," Finance and Economics Discussion Series 2007-16, Board of Governors of the Federal Reserve System (U.S.).
    3. Jonathan Fisher, 2006. "Income Imputation and the Analysis of Expenditure Data in the Consumer Expenditure Survey," Working Papers 394, U.S. Bureau of Labor Statistics.
    4. Marc Roemer, 2002. "Using Administrative Earnings Records to Assess Wage Data Quality in the March Current Population Survey and the Survey of Income and Program Participation," Longitudinal Employer-Household Dynamics Technical Papers 2002-22, Center for Economic Studies, U.S. Census Bureau.
    5. Christopher Jencks & Susan E. Mayer, . "Do Official Poverty Rates Provide Useful Information about Trends in Children's Economic Welfare?," IPR working papers 96-1, Institute for Policy Resarch at Northwestern University.
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