Thesia I. Garner and Kathleen Short (2005) "Economic
Well-Being Based on Income, Consumer Expenditures and Personal Assessments
of Minimal Needs".
Responses to minimum income and minimum spending questions are used to
produce economic well-being thresholds. Thresholds are estimated using a
regression framework. Regression coefficients are based on U.S. Survey of
Income and Program Participation (SIPP) data and then applied to U.S.
Consumer Expenditure Survey (CE) data. Three different resource measures
are compared to the estimated thresholds. The first resource measure is
total before-tax money income, and the other two are expenditure based.
The first of these two refers to expenditure outlays and the second to
outlays adjusted for the value of the service flow of owner-occupied
housing (rental equivalence). The income comparison is based on SIPP data
while the outlays comparisons are based on CE data. Results using official
poverty thresholds are shown for comparison. This is among the earliest
work in the U.S. in which expenditure outlays have been used for economic
well-being determinations in combination with personal assessments, and
the first time rental equivalence has been used in such an exercise.
Comparisons of expenditures for various bundles of commodities are
compared to the CE derived thresholds to provide insight concerning what
might be considered minimum or basic.
Results reveal that CE and SIPP MIQ thresholds are
higher than MSQ thresholds, and resulting poverty rates are also higher
with the MIQ. CE-based MSQ thresholds are not statistically different
from average expenditure outlays for food, apparel, and shelter and
utilities for primary residences. When reported rental equivalences for
primary residences that are owner occupied are substituted for
out-of-pocket shelter expenditures, single elderly are less likely to be
as badly off as they would be with a strict outlays approach in defining
For assistance on how to view PDF files.
- Download PDF version (255K)