Tuesday, November 27, 2012

Some Possibly Surprising Facts About Poverty

I have been covering poverty and the distribution of income in micro this week. Here are some interesting links from the blog of economist Mark Perry called Carpe Diem. He actually has moved recently to a new location, so click here to see it.

More on The U.S. Poor Getting Richer, And Being Envy of the World's Poor. Here he shows how the percentage of poor households in America that owns various appliances and conveniences is very high, often about as high as the entire population of Sweden.

5 Problems With Census Poverty and Income Data. This one shows that over time, median household income per household member has been increasing. Part of the problem with household income numbers is that they don't ofteh adjust for declining size of household.

Our Poor Are the Envy of the World's Poor. Here he mentions that: "In 1971, only about 32 percent of all Americans enjoyed air conditioning in their homes. By 2001, 76 percent of poor people had air conditioning." It is true for other appliances as well.

Consumption Equality 7X > Than Income Equality. Here he mentions that:
"The bottom fifth earned just $9,974, but spent nearly twice that — an average of $18,153 a year. How is that possible? Those lower-income families have access to various sources of spending money that doesn’t fall under taxable income. These sources include portions of sales of property like homes and cars and securities that are not subject to capital gains taxes, insurance policies redeemed, or the drawing down of bank accounts."
New Mpls. Federal Reserve Bank Study Shows Significant Earnings Mobility Between 2001-2007. Here he shows that 44% of the people in bottom quintile in 2001 had moved to a higher quintile in 2007.

Pew Research Calls It "Hollowing Out of the Middle Class," But 150 Americans Moved Up for Every 100 Who Moved Down Between 1971 and 2011. He mentions that:
"Between 1971 and 2011, the share of adult Americans in the “middle class” decreased by ten percentage points from 61% to 51%. Of that 10% of American adults who left the middle class, 6% moved up to the “upper-income” category and 4% move down to the “lower-income” category."
Census Data Show Significant Income Mobility. Here says that:
"From 1996 to 2005, we have the income mobility data for income quintiles. Of those filers who were in the lowest 20% in 1996 and who also filed in 2005, 42.4% remained in the bottom 20% but 57.6% had moved up to a higher quintile: 28.6% were in the next highest quintile, 13.9% were in the middle quintile, 9.9% were in the second highest quintile, and 5.3% were in the highest quintile."
The Rich Are Getting Richer and the Poor Are Getting Richer; The Good Old Days Are Now. In 1971, 88.3% of all American households had a refrigerator. Today, 98.5% of poor households do. This is true for many other goods. More poor people have them now than did the average people in 1971. In 1973, the average worker had to work 89 hours to buy a refrigerator. Today it is only 23 hours. This is true for many other goods.

Bad News for 2 Americas Myth: The Poor Got Richer. Here is one thing it says, as of 2007: "The CBO reports that low-wage households with children had earnings after inflation in 2005 that were about 80% higher than in the early 1990s."


Anonymous said...

what is the source of this information? Is this like Sample Statistics? From what I have seen in America vs. 3rd world countries, we really don't have it bad at all. I guess things like TV (rich and famous) make us feel like we are really bad off.

Cyril Morong said...

You will have to go to each link and find the source in each case.

Here is one example. Every year the Census Bureau in the U. S. issues a report on incomes. This is what they say about their data collection


Source of Estimates
The data in this report are from the 2012 Current Population Survey
Annual Social and Economic Supplement (CPS ASEC) and were collected
in the 50 states and the District of Columbia. The data do not represent
residents of Puerto Rico and U.S. Island Areas.* The data are based on
a sample of about 100,000 addresses. The estimates in this report are
controlled to independent national population estimates by age, sex, race,
and Hispanic origin for March 2011. The estimates for 2010 and 2011 use
population controls based on the 2010 Census. Earlier reports presenting
data for calendar years 1999 through 2010 used population controls
based on the results from Census 2000, updated annually using administrative
records for such things as births, deaths, emigration, and immigration.
Appendix E presents more detail on the introduction of the new
population controls based on the 2010 Census.
The CPS is a household survey primarily used to collect employment data.
The sample universe for the basic CPS consists of the resident civilian
noninstitutionalized population of the United States. People in institutions,
such as prisons, long-term care hospitals, and nursing homes, are
not eligible to be interviewed in the CPS. Students living in dormitories
are included in the estimates only if information about them is reported in
an interview at their parents’ home. Since the CPS is a household survey,
persons who are homeless and not living in shelters are not included in
the sample. The sample universe for the CPS ASEC is slightly larger than
that of the basic CPS since it includes military personnel who live in a
household with at least one other civilian adult, regardless of whether they
live off post or on post. All other Armed Forces are excluded. For further
documentation about the CPS ASEC, see .