A new method for measuring historical poverty trends: Incorporating geographic differences in the cost of living using the Supplemental Poverty Measure
Affiliations: [a] Mathematica Policy Research, Oakland, CA, USA | [b] School of Social Work, Columbia University, New York, NY, USA
Correspondence:
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Corresponding author: Laura Nolan, Mathematica Policy Research, 505 14th St., Suite 800, Oakland, CA 94612, USA. Tel.: +1 510 285 4649; E-mail:LNolan@mathematica-mpr.com
Abstract: The U.S. Census Bureau and the Bureau of Labor Statistics recently developed
a substantially improved measure of poverty, the Supplemental Poverty
Measure (SPM). The SPM has only been released since 2009, and prior efforts
by researchers to construct a historical SPM time series have not taken into
account an essential element of the new measure - geographical differences
in the cost of living - which is necessary for accurately describing
poverty trends in important demographic and regional subgroups. We build the
first historical SPM time series from 1967-2014 that adjusts poverty
thresholds for cost of living. We do so bringing together a constellation of
data sources - the Current Population Survey, the Decennial Census, the
Department of Housing and Urban Development's Fair Market Rents, and others.
We find that geographically adjusting thresholds increases poverty rates in
metro areas, the Western states, and among Latinos, but decreases poverty
rates in non-metro areas and in the South. The geographic adjustment of
poverty thresholds is an impactful component of the SPM.
Keywords: Poverty measurement, Supplemental Poverty Measure, Current Population Survey
