Poverty Measurement: History

The current U.S. poverty measure was developed in the mid-1960s by Mollie Orshansky, a social science research analyst and statistician at the Social Security Administration (SSA). Orshansky developed her poverty thresholds by taking the cost of a minimum adequate diet for families of different sizes and multiplying the cost by three to allow for other expenses. (See "Historic Federal Documents on Poverty Threshold" below for further details.)

In 1965, the U.S. Office of Economic Opportunity adopted the SSA thresholds as a working definition of poverty for statistical purposes and for program planning. In 1969, the U.S. Bureau of the Budget (now the U.S. Office of Management and Budget) issued a directive that made the thresholds the federal government's official statistical definition of poverty.

In 1992, long-standing questions about the poverty measure gave rise to a National Academy of Sciences study panel, the Panel on Poverty and Family Assistance, established at the request of Congress. In 1995 the panel issued a final report and recommendations for change, Measuring Poverty: A New Approach (Washington, DC: National Academy of Sciences Press, 1995).

Each recommendation of the NAS panel invoked complex technical problems and policy issues. Since 1995, a research agenda to translate the panel's recommendations into reality has been developed through intensive discussions among organizations that strongly believe in the need for a more accurate measure of poverty. Some issues in revising the poverty measure are close to resolution or can be easily resolved; others, such as medical expenses and housing, still present complex methodological and political questions.

Since the publication of the panel's report, there has been much research on elements of its recommendations by a variety of government agencies, think tanks, and universities. The Census Bureau has also produced a large number of alternative measures of poverty. However, the methods used to produce these alternatives have changed from year to year, so that there is no consistent time series of alternative poverty statistics.

In June 2004, the Committee on National Statistics (CNSTAT) convened a workshop to review federal research on alternative methods for measuring poverty. The workshop had been requested by the U.S. Office of Management and Budget to evaluate progress in moving toward a new measure of poverty, as recommended in 1995 by the CNSTAT panel. John Iceland, rapporteur for the workshop, summarized its finding in "The CNSTAT workshop on experimental poverty measures, June 2004," in Focus 23, no. 3 (Spring 2005): 26-30

Over the years, IRP affiliates have been closely involved in research on the most appropriate measures of poverty and in advocating that the federal government refine its current measures. In his essay in the IRP conference volume Changing Poverty, Changing Policies called "What Does It Mean to Be Poor in a Rich Society?" Robert Haveman considers the many debates over poverty measurement and the appropriate concept of poverty. A summary of Haveman’s essay was published in Focus 26, no. 2 (Fall 2009): 81-86.

In April 1999, IRP convened a conference, "Poverty: Improving the Definition after Thirty Years," to explore the technical and policy issues involved in improving the poverty measure. Introductory Remarks by conference participant Constance Citro and a Conference Summary, by Thomas Corbett provide a good synopsis of the intent and outcomes of the conference.

Conference Papers (.pdf format)
"Reshaping the Historical Record with a Comprehensive Measure of Poverty," by D. Betson and J. Warlick
"Political Consequences of an Improved Poverty Measure," by G. Burtless
"Alternatives to the Official Poverty Measure: Perspectives and Assessment," by R. Haveman and M. Mullikin

Student Presentations
"Adjusting Thresholds for Geographic Area," by R. Blaine and M. Sosulski
"Family Equivalence Scales in the Poverty Thresholds," by M. Oakleaf and K. Voskuil
"Modest but Adequate: The NAS Proposal to Change the Poverty Measure," by B. Kohler and K. Voskuil
"Treatment of Medical Care Expenditures in Poverty Measurement: The NAS Panel Proposal," by E. Kalinosky and B. Kohler

Historic Federal Documents on Poverty Thresholds

In "The Development and History of the Poverty Thresholds." Social Security Bulletin, 55(4), 3-14, Gordon M. Fisher discusses how Mollie Orshansky developed the poverty thresholds during the 1960’s, and subsequent changes to the thresholds. A synopsis of the article was published as the "The Development and History of the U.S. Poverty Thresholds – A Brief Overview," GSS/SSS Newsletter [Newsletter of the Government Statistics Section and the Social Statistics Section of the American Statistical Association], Winter 1997, pp. 6-7. Fisher also compiled a list of selected articles and papers by Orshansky on the poverty thresholds and the poverty population, including links to many of the articles.

Orshansky based her thresholds on an economy food plan she developed, featured in a 1962 Agriculture Department report [PDF format - 58 pages]. She published her final poverty thresholds in “Counting the Poor: Another Look at the Poverty Profile” Social Security Bulletin, 28(1), 3–29, which was reprinted in Social Security Bulletin, Vol. 51, No. 10, October 1988, pp. 25–51 (available at http://www.ssa.gov/policy/docs/ssb/v28n1/v28n1p3.pdf).