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"Inability to be Self-Reliant" as an Indicator of U.S. Poverty: Measurement, Comparisons, and Implications

Author

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  • Robert Haveman

    (The Jerome Levy Economics Institute)

  • Andrew Bershadker

    (The Jerome Levy Economics Institute)

Abstract

The trend in national policy over the past two decades has emphasized self reliance and a smaller role for government in society. Given this ideological shift, the Official poverty measure, which is based on the premise that all families should have sufficient income from either their own efforts or government support to boost them above a family- size-specific threshold, appears to have less policy relevance now than in prior years. In this paper we present a new concept of poverty, Self- Reliance poverty, which is based on the ability of a family, using its own resources, to support a level of consumption in excess of needs. This concept closely parallels the "capability poverty" measure that has been proposed by Sen. We use this measure to examine the size and composition of the Self-Reliant poor population from 1975 to 1995. We find that Self-Reliance poverty has increased more rapidly over the 1975-95 period than has Official poverty. We find that families commonly thought to be the most impoverished – those headed by minorities, single women with children, and individuals with low levels of education – have the highest levels of Self-Reliance poverty. However, these groups have also experienced the largest increases in this poverty measure. Families largely thought to be economically secure, specifically those headed by whites, men, married couples, and highly educated individuals, while having the lowest levels of self-Reliance poverty, have also experienced the largest increases in that measure. We speculate that the trends in Self-Reliance poverty stem largely from underlying trends in the United States economy, in particular the relative decline of wage rate for whites and men, and the rapidly expanding college-educated demographic group.

Suggested Citation

  • Robert Haveman & Andrew Bershadker, 1998. ""Inability to be Self-Reliant" as an Indicator of U.S. Poverty: Measurement, Comparisons, and Implications," Macroeconomics 9809002, University Library of Munich, Germany.
  • Handle: RePEc:wpa:wuwpma:9809002
    Note: Type of Document - Acrobat PDF; prepared on IBM PC; to print on PostScript; pages: 46; figures: included
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    References listed on IDEAS

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    1. Robert K. Triest, 1998. "Has Poverty Gotten Worse?," Journal of Economic Perspectives, American Economic Association, vol. 12(1), pages 97-114, Winter.
    2. Lillard, Lee A & Willis, Robert J, 1978. "Dynamic Aspects of Earning Mobility," Econometrica, Econometric Society, vol. 46(5), pages 985-1012, September.
    3. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
    4. Sen, Amartya, 1997. "On Economic Inequality," OUP Catalogue, Oxford University Press, number 9780198292975.
    5. Christopher Jencks & Susan E. Mayer, "undated". "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.
    6. Jorgenson, Dale W & Slesnick, Daniel T, 1987. "Aggregate Consumer Behavior and Household Equivalence Scales," Journal of Business & Economic Statistics, American Statistical Association, vol. 5(2), pages 219-232, April.
    7. Chinhui Juhn, 1992. "Decline of Male Labor Market Participation: The Role of Declining Market Opportunities," The Quarterly Journal of Economics, Oxford University Press, vol. 107(1), pages 79-121.
    8. 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.
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    Cited by:

    1. Albelda, Randy, 1999. "Women and poverty: Beyond earnings and welfare," The Quarterly Review of Economics and Finance, Elsevier, vol. 39(5), pages 723-742.

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    • E - Macroeconomics and Monetary Economics

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