Measuring Poverty and Economic Inclusion

Abstract

The current U.S. poverty measure is outdated and has failed to keep up with public consensus on the minimum amount of income needed to "get along" in the United States in the 21st Century. One potential approach to revising the measure, based on recommendations made by a National Academy of Sciences panel in 1995, improves in some ways on the current measure, but has serious limitations of its own that require further research before it is adopted. Moreover, the NAS approach results in a poverty measure that would remain far below the public's get-along level. To address these problems, the incoming Administration should adopt a "tiered" poverty and economic inclusion measure that is modeled on the child poverty measure adopted in 2003 by the United Kingdom.