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  • Individual Author: Kilpatrick, Robert W.
    Reference Type: Journal Article
    Year: 1973

    Comparisons of the extent of poverty at different times are greatly affected by whether the dividing line between the poor and the rest of the population changes as average income grows over time, and if so to what degree. The absolute income standard and the relative income standard are polar hypotheses about the income elasticity of the poverty line. Under an absolute standard of poverty, the poverty line is constant (in deflated dollars). In terms of what people thought of as poverty a century ago, the absolute standard implies that today almost no one is poor in the United States. Under a relative standard of poverty, the poverty line changes in the same proportion as average income if the relative income distribution is constant. The relative standard implies that if the shape of the income distribution is the same today as a century ago, the poverty problem is now no less. Probably more likely than either of these extremes is that people's judgment about the dividing line between poverty and a more adequate standard of living is determined by a mixture of concerns over both...

    Comparisons of the extent of poverty at different times are greatly affected by whether the dividing line between the poor and the rest of the population changes as average income grows over time, and if so to what degree. The absolute income standard and the relative income standard are polar hypotheses about the income elasticity of the poverty line. Under an absolute standard of poverty, the poverty line is constant (in deflated dollars). In terms of what people thought of as poverty a century ago, the absolute standard implies that today almost no one is poor in the United States. Under a relative standard of poverty, the poverty line changes in the same proportion as average income if the relative income distribution is constant. The relative standard implies that if the shape of the income distribution is the same today as a century ago, the poverty problem is now no less. Probably more likely than either of these extremes is that people's judgment about the dividing line between poverty and a more adequate standard of living is determined by a mixture of concerns over both absolute- and relative conditions. If so, growth in average income increases the poverty line, but by less than in the same proportion. This proposition-that the income elasticity of the poverty line is between zero and one-is the hypothesis tested in this paper. (author abstract)

  • Individual Author: Orshansky, Mollie
    Reference Type: Report
    Year: 1976

    The current official measure of poverty used by the Federal government was originally developed by Mollie Orshansky of the Social Security Administration in the early sixties.  Her study, "Children of the Poor", first appeared in the July 1963 Social Security Bulletin, describing a methodology for developing income criteria of need by family size, for families with children.  In January 1965 the Social Security Bulletin contained another article by her entitled "Counting the Poor", which updated and extended the criteria to all types of households, she used as before, a concept of poverty based on budgets centering around cost of a diet which can sustain and adequate nutritional level at a minimal cost using a sliding scale of income requirements for different family sizes and compositions.  An additional refinement was the specification of a lower income level as the threshold for farm families.  This refinement reflected the assumption that farm families customarily obtain housing and food as part of the farm business operation, rather than by direct expenditure. (publisher...

    The current official measure of poverty used by the Federal government was originally developed by Mollie Orshansky of the Social Security Administration in the early sixties.  Her study, "Children of the Poor", first appeared in the July 1963 Social Security Bulletin, describing a methodology for developing income criteria of need by family size, for families with children.  In January 1965 the Social Security Bulletin contained another article by her entitled "Counting the Poor", which updated and extended the criteria to all types of households, she used as before, a concept of poverty based on budgets centering around cost of a diet which can sustain and adequate nutritional level at a minimal cost using a sliding scale of income requirements for different family sizes and compositions.  An additional refinement was the specification of a lower income level as the threshold for farm families.  This refinement reflected the assumption that farm families customarily obtain housing and food as part of the farm business operation, rather than by direct expenditure. (publisher abstract)

    This  Technical Paper collects a number of important articles and papers by Mollie Orshansky and others about the development and early history of the poverty thresholds, including: 

    Mollie Orshansky, "Children of the Poor", Social Security Bulletin, Vol. 26, No. 7, July 1963, pp. 3-13.

    Mollie Orshansky, "Counting the Poor:  Another Look at the Poverty Profile", Social Security Bulletin, Vol. 28, No. 1, January 1965, pp. 3-29 — reprinted in Social Security Bulletin, Vol. 51, No. 10, October 1988, pp. 25-51.

    Mollie Orshansky, "Who's Who Among the Poor:  A Demographic View of Poverty", Social Security Bulletin, Vol. 28, No. 7, July 1965, pp. 3-32.

    Mollie Orshansky, "How poverty is measured", Monthly Labor Review, Vol. 92, No. 2, February 1969, pp. 37-41.

  • Individual Author: Mahoney, Bette S.; Khan, Abdul
    Year: 1976

    Poor persons living in the United States in the 1970s are rich in contrast to their counterparts in other times and places. They are not poor if by poor is meant the subsistence levels of living common in some other countries. Nor are most poor like their counterparts in this country fifty or one hundred years ago. This country is concerned about poverty, its causes and correlates. It is willing to relieve the poverty of some of the poor and it wants to measure the effectiveness of its efforts to do so. None of this can be done without some idea of who is to be considered poor and who is not.

    The report deals with measuring the current status of the poor rather than with the causes or solutions to poverty. A family is none the less poor for having arrived at that state of its own accord. Similarly, the fact that an individual could with modest and reasonable effort escape from poverty has nothing to do with whether he is currently poor...

    The study examines (1) regional, climatic, metropolitan, urban, suburban, and rural differences in the poverty measure, (2)...

    Poor persons living in the United States in the 1970s are rich in contrast to their counterparts in other times and places. They are not poor if by poor is meant the subsistence levels of living common in some other countries. Nor are most poor like their counterparts in this country fifty or one hundred years ago. This country is concerned about poverty, its causes and correlates. It is willing to relieve the poverty of some of the poor and it wants to measure the effectiveness of its efforts to do so. None of this can be done without some idea of who is to be considered poor and who is not.

    The report deals with measuring the current status of the poor rather than with the causes or solutions to poverty. A family is none the less poor for having arrived at that state of its own accord. Similarly, the fact that an individual could with modest and reasonable effort escape from poverty has nothing to do with whether he is currently poor...

    The study examines (1) regional, climatic, metropolitan, urban, suburban, and rural differences in the poverty measure, (2) differences due to family size and head of household, and  (3) the availability of state and other subnational data more current than the decennial Census, including cost of living, cost of housing, labor market and job availability, prevailing wage rates, unemployment rates, income distribution, and the eligibility criteria for aid to families with dependent children (AFDC) under state plans approved for Title IV of the Social Security Act. (author introduction)

  • Individual Author: Sen, Amartya
    Reference Type: Journal Article
    Year: 1976

    The primary aim of this paper is to propose a new measure of poverty, which should avoid some of the shortcomings of the measures currently in use. An axiomatic approach is used to derive the measure. The conception of welfare in the axiom set is ordinal. The information requirement for the new measure is quite limited, permitting practical use. (author abstract)

    The primary aim of this paper is to propose a new measure of poverty, which should avoid some of the shortcomings of the measures currently in use. An axiomatic approach is used to derive the measure. The conception of welfare in the axiom set is ordinal. The information requirement for the new measure is quite limited, permitting practical use. (author abstract)

  • Individual Author: Foster, James; Greer, Joel; Thorbecke, Erik
    Reference Type: Journal Article
    Year: 1984

    Several recent studies of poverty have demonstrated the usefulness of breading down a population into subgroups defined along ethnic, geographical, or other lines. Such an approach to poverty analysis places requirements on the poverty measure in addition to those proposed by Sen. In particular, the question of how the measure relates subgroup poverty to total poverty is crucial to its applicability in this form of analysis. At the very least, one would expect that a decrease in the poverty level of one subgroup ceteris paribus should lead to less poverty for the population as a whole. At best, one might hope to obtain a quantitative estimate of the effect of a change in subgroup poverty on total poverty, or to give a subgroup’s contribution to total poverty.

    One way to satisfy the above criteria is to use a poverty measure that is additively decomposable in the sense that total poverty is a weighted average of the subgroup poverty levels. However, the existing decomposable poverty measures are inadequate in that they violate one or more of the basic properties...

    Several recent studies of poverty have demonstrated the usefulness of breading down a population into subgroups defined along ethnic, geographical, or other lines. Such an approach to poverty analysis places requirements on the poverty measure in addition to those proposed by Sen. In particular, the question of how the measure relates subgroup poverty to total poverty is crucial to its applicability in this form of analysis. At the very least, one would expect that a decrease in the poverty level of one subgroup ceteris paribus should lead to less poverty for the population as a whole. At best, one might hope to obtain a quantitative estimate of the effect of a change in subgroup poverty on total poverty, or to give a subgroup’s contribution to total poverty.

    One way to satisfy the above criteria is to use a poverty measure that is additively decomposable in the sense that total poverty is a weighted average of the subgroup poverty levels. However, the existing decomposable poverty measures are inadequate in that they violate one or more of the basic properties proposed by Sen. Stated another way, of all the measures that are acceptable by the Sen criteria, none is decomposable. In fact, the Sen measure and its variants that rely on rank-order weighting fail to satisfy the basic condition that an increase in subgroup poverty must increase total poverty. This note is a first step towards resolving these inadequacies.

    In what follows we present a simple, new poverty measure that (i) is additively decomposable with population-share weights, (ii) satisfies the basic properties proposed by Sen, and (iii) is justified by a relative deprivation concept of poverty. The inequality measure associated with our poverty measure is shown to by the squared coefficient of variation and indeed the poverty measure may be expressed as a combination of this inequality measure, the headcount ratio, and the income-gap ratio in fashion similar to Sen. We generalize the new poverty measure to a parametric family of measures where the parameter can be interpreted as an indicator of “aversion to poverty.” A brief empirical application demonstrates the usefulness of the decomposability of poverty. (author abstract)

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