- Christopher Wimer, Liana Fox, Irv Garfinkel, Neeraj Kaushal, and Jane Waldfogel
- December 2013
- Link to dp141613 (PDF)
Poverty measures set a poverty line or threshold and then evaluate resources against that threshold. The official poverty measure (OPM) is flawed on both counts. Because of these (and other) failings, statistics using the official poverty measure do not provide an accurate picture of poverty or the role of government policies in combating poverty. To address these well-known limitations, the Census Bureau recently implemented a supplemental poverty measure (SPM). In recent work, we have produced SPM-like estimates for the period 1967 to 2012, using historical data on incomes from the 1968 to 2013 Annual Social and Economic Supplement to the Current Population Survey (March CPS) and historical data on expenditures from the 1961, 1972/73, and 1980 to 2012 Consumer Expenditure Survey (CEX). One possible limitation of our historical SPM estimates is that they rely on annual calculations of thresholds even in years where we have incomplete CEX data. For these reasons, in this report we apply an alternative poverty measure that differs from the SPM in only one respect. Instead of having a threshold that is re-calculated over time, we use today’s threshold and carry it back historically by adjusting it for inflation using the CPI-U-RS.