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How Poor Are America’s Poorest? U.S. $2 A Day Poverty In A Global Context

August 28, 2014 Comments off

How Poor Are America’s Poorest? U.S. $2 A Day Poverty In A Global Context
Source: Brookings Institution

In the United States, the official poverty rate for 2012 stood at 15 percent based on the national poverty line which is equivalent to around $16 per person per day. Of the 46.5 million Americans living in poverty, 20.4 million live under half the poverty line. This begs the question of just how poor America’s poorest people are.

Poverty, in one form or other, exists in every country. But the most acute, absolute manifestations of poverty are assumed to be limited to the developing world. This is reflected in the fact that rich countries tend to set higher poverty lines than poor countries, and that global poverty estimates have traditionally excluded industrialized countries and their populations altogether.

An important study on U.S. poverty by Luke Shaefer and Kathryn Edin gently challenges this assumption. Using an alternative dataset from the one employed for the official U.S. poverty measure, Shaefer and Edin show that millions of Americans live on less than $2 a day—a threshold commonly used to measure poverty in the developing world. Depending on the exact definitions used, they find that up to 5 percent of American households with children are shown to fall under this parsimonious poverty line.

These numbers are intended to shock—and they succeed. The United States is known for having higher inequality and a less generous social safety net than many affluent countries in Europe, but the acute deprivations that flow from this are less understood. A crude comparison of Shaefer and Edin’s estimates with the World Bank’s official $2 a day poverty estimates for developing economies would place the United States level with or behind a large set of countries, including Russia (0.1 percent), the West Bank and Gaza (0.3 percent), Jordan (1.6 percent), Albania (1.7 percent), urban Argentina (1.9 percent), urban China (3.5 percent), and Thailand (4.1 percent). Many of these countries are recipients of American foreign aid. However, methodologies for measuring poverty differ wildly both within and across countries, so such comparisons and their interpretation demand extreme care.

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Understanding Changes in Poverty

August 27, 2014 Comments off

Understanding Changes in Poverty
Source: World Bank

Understanding Changes in Poverty brings together different methods to decompose the contributions to poverty reduction. A simple approach quantifies the contribution of changes in demographics, employment, earnings, public transfers, and remittances to poverty reduction. A more complex approach quantifies the contributions to poverty reduction from changes in individual and household characteristics, including changes in the sectoral, occupational, and educational structure of the workforce, as well as changes in the returns to individual and household characteristics. Understanding Changes in Poverty implements these approaches and finds that labor income growth that is, growth in income per worker rather than an increase in the number of employed workers was the largest contributor to moderate poverty reduction in 21 countries experiencing substantial reductions in poverty over the past decade. Changes in demographics, public transfers, and remittances helped, but made relatively smaller contributions to poverty reduction. Further decompositions in three countries find that labor income grew mainly because of higher returns to human capital endowments, signaling increases in productivity, higher relative price of labor, or both. Understanding Changes in Poverty will be of particular relevance to development practitioners interested in better understanding distributional changes over time. The methods and tools presented in this book can also be applied to better understand changes in inequality or any other distributional change.

Neighborhood Change, 1970 to 2010: Transition and Growth in Urban High Poverty Neighborhoods

August 26, 2014 Comments off

Neighborhood Change, 1970 to 2010: Transition and Growth in Urban High Poverty Neighborhoods (PDF)
Source: Impresa Consulting

This paper analyzes changes in high poverty urban neighborhoods in the nation’s large metropolitan areas between 1970 and 2010. Using census tract data to track neighborhood performance, and defining high poverty as neighborhoods with a poverty rate of greater than 30 percent, this paper finds:

About 1,100 census tracts in urban neighborhoods in the nation’s large metropolitan areas had poverty rates in excess of 30 percent in 1970. These tracts had a population of 5 million, of which nearly 2 million were poor.

High poverty was persistent in these neighborhoods. Four decades later, 750 of these tracts—home to about three-quarters of the 1970 high poverty neighborhood population—still had rates of poverty in excess of 30 percent.

Though poverty persisted, these high poverty neighborhoods were not stable— in the aggregate they lost population, with chronic high poverty neighborhoods losing 40 percent of their population by 2010.

Welfare Rules Databook: State TANF Policies as of July 2013

August 25, 2014 Comments off

Welfare Rules Databook: State TANF Policies as of July 2013
Source: Urban Institute

The Welfare Rules Databook provides tables containing key Temporary Assistance for Needy Families (TANF) policies for each state as of July 2013, as well as longitudinal tables describing selected state policies from 1996 through 2013. The tables are based on the information in the Welfare Rules Database (WRD), a publicly available, online database tracking state cash assistance policies over time and across the 50 states and the District of Columbia. The Databook summarizes a subset of the information in the WRD. Users interested in a greater level of detail are encouraged to use the full database, available at http://anfdata.urban.org/wrd.

Cost Containment in the WIC Program: Vendor Peer Groups and Reimbursement Rates

August 21, 2014 Comments off

Cost Containment in the WIC Program: Vendor Peer Groups and Reimbursement Rates
Source: USDA Economic Research Service

This study looks at current WIC cost containment strategies in an effort to make them more effective, enabling the program to serve more participants with its fixed budget resources.

Economic Characteristics of Households in the United States: 1st, 2nd, 3rd and 4th Quarters 2012

August 20, 2014 Comments off

Economic Characteristics of Households in the United States: 1st, 2nd, 3rd and 4th Quarters 2012
Source: U.S. Census Bureau

This collection of seven tables for each quarter comes from the Survey of Income and Program Participation. The tables that examine the role of government-sponsored benefit programs and the labor market among the nation’s people and households within the economic climate of each quarter of 2012. Specifically, the tables present statistics on average monthly income, participation in government-sponsored social welfare or social insurance programs, and labor force activity during each period.

New Policy Makes It Easier for Community Eligibility Schools to Participate in E-Rate Program

August 19, 2014 Comments off

New Policy Makes It Easier for Community Eligibility Schools to Participate in E-Rate Program
Source: Center on Budget and Policy Priorities

A new Federal Communications Commission (FCC) policy will make it easier for school districts adopting the Community Eligibility Provision — through which they can serve meals at no charge to all students — to apply for discounted telecommunications services and Internet access through the E-rate program. The new E-rate policy streamlines the discount calculation process for community eligibility schools so that they do not face any additional burdens relative to other schools.

The Community Eligibility Provision, a relatively new option within the federal school meal programs, eliminates school meal applications. Schools are eligible to adopt the Community Eligibility Provision based on the share of their students who are low-income, as assessed by other programs. Schools that adopt community eligibility must serve all meals at no charge. Community eligibility has been implemented a few states at a time over the past three years and is available nationwide for the 2014-2015 school year.

Since community eligibility schools do not determine which individual children are eligible for free or reduced-price meals, the E-rate program has developed ways for them to calculate their E-rate discount level. For school years 2011-2012 through 2014-2015, the FCC (which sets E-rate policy) directed community eligibility schools to continue using the share of students approved for free or reduced-price meals in the year prior to implementing community eligibility for purposes of determining their E-rate discount. Schools with 75 percent or more of their students approved for free or reduced-price meals receive a 90 percent discount; most schools that adopt community eligibility likely fall into this category.

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