P & SW 1, 2, 3

The Supplemental Poverty Measure estimated a quarter of Americans (25.7%) were in poverty in 2019. (1?)

11.7 percent of the population fell into poverty, representing 38.2 million Americans. Furthermore, 25.7 percent were in poverty or near poverty, 3.9 percent experienced extreme poverty.

Not unitl what decade did we have actual measures of poverty

1970's

Within how many years do most people escape poverty

2 years

Absolute Measure of Poverty

A household failing to have a particular amount of income to purchase those goods and services that are necessary for a minimally adequate life.

Adam Smith Definition of Poverty - The Wealth of Nations (1776)

A lack of those necessities that "the custom of the country renders it indecent for credible people, even the lowest of the order, to be without."

A post-transfer measure of poverty

A measure of poverty which INCLUDES personal earnings with government cash programs. A post-transfer measure of poverty is based on a household's overall annual income but excludes any cash, in-kind benefits or tax credits... False (2nd part of this card)

A pre-transfer is

A measure of poverty. based on household yearly income, NO cash or in-kind benefits

Who is at higher risks of falling into poverty

African American, female, low education

Pretransfer Measure

Based on households yearly income, no cash or in-kind benefits

Pretransfer Measure of Poverty

Based on the household's overall annual income but excludes any cash, in-kind benefits or tax credits that it might have received from the government.

Over long periods of time, detrimental events which can then throw individual and their family into poverty RARELY happen. (2)

FALSE - over time, MUCH MORE LIKELY to happen

The fact that the poverty rate for whites in 2019 was 7.3% while the Black poverty rate was 18.8%, 15.7% Native American, 23.7 %, and Asian-Pacific Islanders, 7.3%, DO NOT reflect disparities across economic measure (3)

False - It DOES reflect disparities

Poverty is _?

Fluid (changes easily)

Absolute Measure

Household failing to have amount to purchase goods.. Anabsolute approach to defining poverty details a minium threshold for adequate living conditions and individual failings that fall below that threshold are considered poor. TRUE

Posttransfer measure

Includes personal earnings with government cash programs

OECD stands for what...

Organisation for Economic Cooperation and Development

Census Tract

Rough estimates corresponding to neighborhood, averages 4,000 people or 1,500 homes

Income Measuring

Standard economic approach uses household income to determine poverty

Supplemental poverty measure

The SPM calculates the poverty line by incorporating expenses such as tax payments, location, work expenses, food, clothing, shelter, and utilities

Each year the poverty levels are adjusted to account for inflation (1)

True

The estimates of poverty using the Supplemental Measure tend to be slightly higher than when using the official measure of poverty.

True

Absolute Measure of Poverty continued

a threshold or line (usually based on income) at or below which individuals or groups are identified as living in poverty

How was the official measure of poverty calculated

council of economic advisors created a poverty threashold. neede dto narrow down "essentials" and chose food (more uniform). used survey info on what % of income poor spent on food. 1960's = one-third. cea constructed measure based on this %.

Mollie Orshansky

economist for the Social Security Administration who developed the first formula for calculating the federal poverty threshold

Mark Rank and Thomas Hirschl

helped shed light on poverty, 20 yrs ago, longest panel run in world

How did Mollie Orshansky modifiy the measure?

it is adjusted for family size and time and only adjusted for inflation overall. no adjustment specifically for food.

Human Capital

the knowledge and skills that workers acquire through education, training, and experience. To understand why poverty occurs, one must consider the role that lack of. human capital plays on accentuating economic vulnerability. TRUE

Human Capital

the skills and knowledge gained by a worker through education and experience or Refers to attributes individuals have acquired that allow them to complete more/less effectively in job market.

A census tract can be thought of as roughly corresponding to a neighborhood and is averages around 4,000 people (or about 1,500 housing units)

true

The standard economic approach has been to use a household's income to determine whether or not they fall into poverty and DOES NOT take into account the value of any assets that the household my hold (1)

true

Latent povrety

would be poor without welfare programs

Human Capital refers to attributes individuals have acquired that allow them to complete more/less effectively in job market.

True

In comparing the poverty in the United States to other Organisation for economic Cooperation and Development countries, we find that American poverty is both more prevalent and more extreme

True

Women are more likely to experience poverty than me

True

Childhood thus represents a time of great economic vulnerability for many of Americas youngest citizens.

True

Individuals in poverty are LESS likely to be stigmatized and discriminated against (1)

False - MORE LIKELY

Adam Smith, an economist working for the Social Security Administration, was tasked with devising the country's yardstick for measuring poverty (!)

False - Molly Orshansky

Weak social security nets and relatively low wages DO NOT contribute to both the relative and absolute depths of poverty in the US (2)

False - Weak safety nets DO contribute to relative and absolute poverty

Approximately 10% of all the US Children between ages 1 and 20 years will at some point reside in a houshold that receives food stamps from the Supplemental Nutrition Assistance Program (SNAP) (2)

False - almost half (49%)

The distance of the poor from the overall median (middle) income in the United States is NOT extreme

False - is extreme separation between poor and middle America

The levels of poverty established each year are for the entire nation and take the cost of living differences found in various parts of the country into consideration. (1?)

False - it DO NOT take into account cost of living differences

A post-transfer measure of poverty is based on a household's overall annual income but EXCLUDES cash, in-kind benefits, or tax credit that it might have received from the government

False - it includes government programs such as social security, unemployment and food stamps Pretransfer measure EXCLUDES these assistances

In 1964, President Richard Nixon historically declared war on poverty

False - it was Lyndon B. Johnson

Most Americans believe that encountering poverty is highly likely and perceive the benefits of antipoverty policy and economic safety nets as being in their own best interest. (2)

False - most believe it is a remote possibility to encounter poverty

Those who were in poverty this year are roughly the same people who were in poverty last year and the next year (2)

False - most people get out of poverty within 1 year

The vast majority of the poor live in high-poverty, inner city neighborhoods

False - the vast majority of the poor DO NOT live in high-poverty, inner-city neighborhoods (urban). They live in rural areas

Individuals in poverty are less likely to be stigmatized and discriminated against (1?)

False - they are MORE likely to be discriminated against than any other group

Demographics, human capital and patters of residence DO NOT play a role in increasing or decreasing human vulnerability of individuals cis-a-vers the labor market

False - they definitely do play a role

Refer to table 2.4, Extent of Poverty Across 26 OECG Countries in the Rank Test. Is the United States ranked first or last? (2)

First - the United States has far and away the highest overall poverty rate in this group of 26 developed nations, includes childhood poverty

The Supplemental Poverty Measure estimated a quarter of Americans (25.7%) were in or near poverty in 2019

True - According to this measure, 11.7 percent of the population fell into poverty, representing 38.2 million Americans. 25.7 percent were in poverty or near poverty, 3.9 percent experienced extreme poverty.

Most poor live in what areas?

Rural areas (open countrysides - not city)

A post- transfer measure of poverty will include personal earnings along with government cash programs (such as Social Security or unemployment insurance) and/or in-kind programs (such as food stamps) and tax credits in calculating a households overall income.

True

Despite having the highest standard of living, the United Sates leads all nation in having the highest rates of child poverty at 20.9%, while the overall averages of the other 25 OECD nations stands at 11.7% 92)

True

Economic risk that accompanies our economic system (job loss, illness, families splitting up) may cause dwindling income that eventually results in poverty (2)

True

Having a physical or mental disability makes it more difficult to complete effectively in the labor market as this attribute may shrink the number of jobs one is competitive for and/or reduce the number of hours one can work

True

Human capital refers to the attributes that help or hinder an individual's ability to compete in the labor market, such as quality and type of acquired education, various skills, and talents, job experience or having the physical or mental ability

True

Results indicate that between ages 20-75 years, nearly 60% of Americans will experience at least one year below the official poverty line, while three quarter of Americans will encounter poverty or near poverty (150% below the official poverty line) (2)

True

The absolute approach to defining poverty details a minimum threshold for adequate living conditions and individual falling below the threshold are considered poor. (1?)

True

For 2019, 34 million individuals or 10.5% of the population fell below the official poverty line. (1?)

True 10.5 % of the population fell below the official poverty line 18.1 % experienced poverty or near poverty, 4.7 % were living in extreme poverty.

Most deep seated poverty in the US is generally found in rural America (3)

True (rural - outside of the cities)

For most American's, the question is not if they will encounter poverty, but rather when, which entails a fundamental shift in the perception and meaning of poverty

True - 65% of American's, ages 25-65 will use these safety nets (SNAP, Medicate, etc)

Provide 4 reasons of why people fall into poverty

employment, financial reasons, family changes, health issues

Pretransfer and posttransfer measures are used to measure impact of

government programs

The Standard economic approach is what

has been to use a households income to determine whether or not they fall into poverty. But DOES NOT take into account any assets they own

Non-whites have a higher poverty rate than whites, but a majority of the poor are

white, due to larger demographic - meaning more people in the country so the Number will be higher, however, the PERCENTAGE will be lower

African Americans, women, female-headed households, and those with low educational attainment are at higher risk of new spells, multiple spells, and longer-lasting spells

True

Approximately two-third of the countrys population currently reside in these 100 urban areas.

True

Supplemental Poverty Measure (SPM) (1)

-Attempts to address the criticisms of the Poverty Line -Takes into account: housing, food, clothing, utilities, and other needs such as transportation, personal care items, etc., as well as public assistance benefits -Criticized for not being a relative poverty measure

General Definition of Poverty

Can't get/deprived of the necessities people need to live (examples: shelter, food, clean water, medication/health care, transportation, clothing, utilities, free time (constantly working to make ends meet), child care)

A pre-transfer measure of poverty INCLUDES earnings along with government cash programs (such as social security or unemployment insurance) and other in-kind programs (such as food stamps) and tax credit in calculating a household's overall income (1)

FALSE - post transfer measure includes these government assistant programs

Asset-Based Measure of Poverty

Gets at the idea of whether individuals have enough assets (ex. saving and checking accounts) to allow them to get over a period where their stream of income has been stopped.

Asset Measuring

If individuals have enough income to get over period of no income. An asset-based measure of poverty gets at the idea of whether individuals have enough assets (i.e, savings and checking accounts) to allow them to get over a period where their steam of income has stopped. - TRUE

Post-transfer Measure of Poverty continued

Includes personal earning along with government cash programs (such as Social Security or unemployment insurance) and/or in-kind programs (such as food stamps) and tax credits in calculating a household's overall income.

Poverty levels are adjusted for what?

Inflation

Helpful things to avoiding poverty

Marriage, education, employment

Between 25 and 75 yrs

TRUE - 60% will experience 1 yr below poverty line, while 3/4 will experience poverty or near poverty

The measuring stick to determine whether an individual fall above or below the poverty threshold is the annual income for all members in the household calculated from pretax dollars, and DOES NOT include in-kind program benefits such as Medicaid or food stamps, or tax credits such as Earned Income Tax Credits. (1)

True - DOES NOT include..

One begins by estimating the household costs of obtaining a minimally adequate diet during the course of the year.

True - adequate diet

A little over a quarter (27%) of Americans use at least one major means-tested programs (Medicaid, the Supplemental Nutrition Program or SNAP, Housing Assistance, the Supplemental security Income Program or SSI, The Temporary Assistance for Needy Families Program (TANF) and/or General Asssistance) at some point during the year. (2)

True - be sure to be able to list all these

Most deeply seeded poverty in the US is generally found in rural America

True - many believe it is in the cities, but it i

The benefit that welfare recipients are largely underserving of assistance is at the heart of opposition to welfare programs (2)

True - most believe they DO NOT deserve help

According to research by Mary Jo Bane and David Ellwood, most people who slip into poverty are quite successful in getting out (2)

True - most get out of poverty in one or two years

An assesset-based measure of poverty gets at the idea of whether individuals have enough assets (i.e. saving and checking accounts), to allow them to get over periods where their stream of income has been stopped. (1?)

True - plan for rainy day concept

A relative measure of poverty looks at where the household's income falls relative to the rest of the population

True - related to the rest of people. 62% of those 25-65 will experience at least 1 year in poverty.

The majority of the poor are white as they comprise a much larger segment of the overall population, and therefore, even though their rate of poverty is lower than nonwhites, they still make up the majority of the poor. (3)

True - the population NUMBERS are higher for whites but the PERCENTAGE is lower

In 2019, the poverty line for a household of three was set at $20,335 - TRUE (1)

True - the poverty line for a household of three was set at $20,335. Consequently, a three-person household that earned less than this amount would be counted as in poverty.

Relative Measure

Type of measure that considers total amounts in relation to population sizes & cross country examination

The relative measure

Type of measure that considers total amounts in relation to population sizes. A relative measure of poverty looks at where a household's income falls relative to the population. TRUE

Income-Based Measure of Poverty

Using a household's income to determine whether or not they fall into poverty.

Social equality

a condition in which no differences in wealth, power, prestige, or status based on nonnatural conventions exist. Implies that people share access to public amenities and responsibilities regardless of economic status. and the absence of class stratification.

relative measure of poverty

a measure that looks at individuals or groups relative to the rest of their community or society rather than setting an absolute line... relative to the standard of living - everyone else. A relative measure of poverty looks at where a household's income falls relative to the rest of the population TRUE

Relative Measure of Poverty

compares person or group to the rest of the community or society