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Setting and Updating Modern Poverty Thresholds

Author

Listed:
  • Thesia I Garner

    () (U.S. Bureau of Labor Statistics)

  • David Betson

    () (University of Notre Dame)

Abstract

This research compares median-based thresholds with ones based on the 33rd percentile using Consumer Expenditure Interview Survey (CE) data from 2004 quarter one through 2009 quarter one. Thresholds for reference families are produced using two different approaches: (1) calculating the thresholds based on the expenditure records of reference families composed of two adults with two children; and (2) calculating the thresholds using expenditures from all consumer units participating in the CE, but first converting their expenditures into adult equivalent value using the three-parameter equivalence scale before identifying the median and percentile values. Different updating mechanisms examined include: (1) an annual recalculation of the 33rd percentile of the reference family’s outlays on FCSU, and (2) changes in the reference family’s median spending or consumption based on needs. Thresholds, based on spending and consumption concepts to value needs for food, clothing, shelter, and utilities (FCSU), are produced.

Suggested Citation

  • Thesia I Garner & David Betson, 2010. "Setting and Updating Modern Poverty Thresholds," Working Papers 435, U.S. Bureau of Labor Statistics.
  • Handle: RePEc:bls:wpaper:ec100030
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    More about this item

    Keywords

    poverty measurement; expenditures; rental equivalence; subsidized housing;

    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty

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