Measuring Poverty A New Approach (1995) / Chapter Skim
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B DATA SOURCES FOR MEASURING POVERTY
B DATA SOURCES FOR MEASURING POVERTY
Pages 391-420
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From page 391... ...
MAJOR FEATURES OF THE CEX, MARCH CPS, PSID, AND SIPP Consumer Expenditure Survey The CEX is sponsored by the Bureau of Labor Statistics (BLS) and conducted by the Census Bureau, with a current budget of about $12 million per year.
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From page 392... ...
Design and Use The Interview Survey includes a sample of 6,800 consumer units (of which about 5,000 are used for quarterly estimates) , interviewed in person at 3month intervals.
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From page 393... ...
(The Interview and Diary Survey samples are independent, so there is no way to actually link the microrecords.) However, some proportion of consumer units in the sample for the Interview Survey do not have observations for all four quarters because of dropping out of the survey or moving away from the sampled address.
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From page 394... ...
; usual weekly expenses for supermarkets and specialty food stores; usual monthly expenses for liquor and food away from home; quarterly benefits from food stamps (and months received) and other meals provided free; quarterly amounts for selected services and goods (e.g., laundromats)
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From page 395... ...
. Sources obtained for the consumer unit as a whole include worker's compensation and veterans' benefits; public assistance; interest on savings accounts and bonds; regular income from dividends, royalties, and estates and trusts; income from pensions or annuities from private and public sources; net income or loss from roomers or boarders; net income or loss from rental property; income from alimony, child support, and regular contributions from persons outside the consumer unit; lump-sum payments; money from the sale of household furnishings or other belongings; other money income (e.g., scholarships, foster care payments)
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From page 396... ...
. The content of the March supplement includes · labor force participation and job history in the prior calendar year for each household member aged 15 or older; · annual income for the prior calendar year for each household member aged 15 or older by detailed source about 30 types of regular cash income are identified separately, including wages and salaries, net self-employment income, Social Security for oneself or a spouse, Social Security for one's children, railroad retirement, unemployment compensation, veterans' compensation, black lung payments, disability payments, SSI, Aid to Families with Dependent Children (AFDC)
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From page 397... ...
The reporting unit is the family, defined as one of the following: a single person living alone or sharing a household with other nonrelatives; a family of members related by blood, marriage, or adoption; an unmarried couple living together in what appears to be a fairly permanent arrangement. The respondent is the family head, usually the adult male head if there is one.
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From page 398... ...
Several factors increased the nonresponse from the SEO sample, including the requirement by the Census Bureau that SEO families sign a release allowing their names to be given to the PSID (Hill, 1992~. The extent to which attrition introduces bias into estimates from the PSID is not clear.
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From page 399... ...
; veterans' benefits; other retirement pay, pensions, or annuities; unemployment compensation; worker's compensation; alimony; child support; help from relatives; and anything else; · income sources and amounts for the spouse for the past calendar year (including which months received) from earnings; unemployment compensation; worker's compensation; and interest, welfare, pensions, child support, or any other source (with each source to be separately listed)
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From page 400... ...
Under this design, three panels are in the field in most months of each year. (For information about response rates and other aspects of data quality, see below.)
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From page 401... ...
Content The content of the current SIPP core interview includes · demographic characteristics; · monthly information on labor force participation, job characteristics, and earnings; and · monthly information on public and private health insurance coverage; · monthly information on detailed sources and amounts of income from public and private transfer payments; information monthly for the most part-on noncash benefits (food stamps, school lunch, etc.~; and information for the 4-month period on income from assets. In total, about 65 separate sources of cash income are identified for each household member aged 15 and over, together with benefits from seven in-kind programs- for a few sources annual amounts are obtained in topical modules (see Citro and Kalton, 1993:Tables 3-1, 3-2~.
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From page 402... ...
Topics covered to date have included characteristics of job from which retired, child care, child support, disability status of children, energy use, extended measures of well-being, functional activities, health status and utilization of health care, home health care, household relationships, housing costs and finance, job offers and reservation wage, long-term care, pension plan coverage, retirement plans, support for nonhousehold members, training, work expenses, and work schedule (see Citro and Kalton, 1993:Table 3-13~. Summary Comparisons In evaluating the usefulness of a survey for measuring poverty, it is important to consider several characteristics: sample size and design; the amount of detail for data on income, taxes, assets, and expenditures; and the quality of the information.
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From page 403... ...
Thus, the less complete income reporting at the lower end of the distribution in the March CPS relative to SIPP is probably partly due to the fact that the March CPS is a supplement to a survey in which the major emphasis is on collecting monthly labor force information. Income reporting is probably particularly poor in the CEX Interview Survey also partly because the CEX is an expenditure survey, not an income survey.
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From page 404... ...
; interviews every 4 months Income Data Annual data Data for prior Data for prior Data for about for 12 months calendar year calendar year 70 cash and in prior to 2nd for about 35 for about 25 kind sources at and 5th cash and in- cash and in- each 4-month interviews; kind sources kind sources wave, with 5 sources for with specific monthly individuals, months reporting for 11 sources for received most sources consumer unit; major in-kind benefits Tax Data Information to determine federal, state, and local income taxes; payroll taxes; property taxes; sales taxes None Information to determine federal and state Income taxes; payroll taxes; property taxes Information to determine federal, state, and local income taxes; payroll taxes; property taxes consumer unit; and the total number of sources asked about is considerably smaller than in the other surveys. Experience gained in the Income Survey Development Program (ISDP-the predecessor to SIPP)
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From page 405... ...
Dynamics Participation Asset Detailed inven- None, except Regularly, Detailed inven Holdings tory of property ascertains information tory of real and Dataa holdings and home about home financial assets household ownership value and mart- and liabilities appliances; gage debt; once each panel; information at occasionally, more frequent 5th interview on information measures for credit balances about saving assets relevant for current behavior and for assistance month and 1 year wealth programs ago; information on financial asset holdings currently and 1 year ago Expenditure Detailed quar- None Monthly rent Information Data terry data for or mortgage once or twice expenditures costs; annual each panel on estimated to utility costs; last month's account for average weekly out-of-pocket 60-70% of total food costs; medical care expenditures; child support costs, shelter global (or payments costs (mortgage usual) quarterly or rent and data for utilities)
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From page 406... ...
Categories of Information Taxes The March CPS income supplement asks no questions about any type of tax payment. Currently, for use in its experimental poverty estimates, the Census Bureau models federal income taxes, state income taxes, and
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From page 407... ...
. SIPP obtains considerably more detailed information: monthly information on recipiency and benefit amounts for food stamps and the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC)
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From page 408... ...
Nonresponse rates are low for the core asset ownership questions, for example, about 1 percent for savings accounts and stocks; but they are generally high for the questions on 4-month income flows, for example, 30-35 percent for interest and 30 percent for reinvested dividends Jabine, King, and Petroni, 1990:Table 5.5~. After imputation for nonresponse, SIPP obtains an estimated 80 percent of the dividend income reported to the Internal Revenue Service (IRS; compared with 61% in the March CPS)
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From page 409... ...
Nonresponse rates to the questions on value of asset holdings in the topical modules are also very high, although lower than were experienced in the ISDP: 35-40 percent for value of own business, market value of stocks and mutual fund shares, and debt on these assets. After imputation, SIPP obtains higher estimates of equity in homes and motor vehicles in comparison with estimates of the Federal Reserve Board because of somewhat higher estimates of gross value and considerably lower estimates of debt in SIPP, but it obtains considerably lower estimates of equity in noncorporate business, value of financial assets, and consumer debt (see Eargle, 1990:Table D-2.7 Ability to Support Other Estimates Shorter or Longer Term Measures The March CPS provides annual measures of income and poverty.
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From page 410... ...
State Estimates The CPS sample size and design make it possible to analyze poverty for geographic areas as well as population groups. The Census Bureau recently published state poverty rates (Bureau of the Census, 1992c:Table B)
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From page 411... ...
Although some research on data quality has been done for the March CPS and considerably more research has been done for SIPP, it is not possible at this time to provide an estimate of the total error in the poverty or other income statistics from either survey. There is some comparative inflation available on what might be termed internal indicators of quality, such as population coverage ratios and household and item response rates, that may indicate potential problems in survey estimates.
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From page 412... ...
More recent data indicate that the situation has not improved: the March 1992 CPS covered only 79 percent of black men, 87 percent of black women, and 90-95 percent of white and Hispanic men and women (Coder, 1992a:Table C-1. The Census Bureau uses ratio-estimatior~ procedures to adjust SIPP and March CPS survey weights for population undercoverage.
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From page 413... ...
Yet, 45 percent fail to respond to the CPS, and another 9 percent of people in otherwise interviewed households fail to respond (Citro, 1991:26~. In addition, a considerable number of people, although responding to the basic CPS labor force questionnaire, do not respond to the March income supplement.
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From page 414... ...
Individuals who did not complete all of the interview waves, compared with those who did, tended to include more residents of large metropolitan areas, renters, members of racial minorities, children and other relatives of the reference person, people aged 15-24, never-married people, and people with no savings accounts or other assets Jabine, King, and Petroni, 1990:35-37, Table 5.4~. A recent analysis of attrition from the 1990 SIPP panel obtained similar results (Lames, Tin, and Eargle, 1994~.
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From page 415... ...
It is important to note that the current cross-sectional nonresponse adjustments in SIPP make only minimal use of the information that is available from previous waves for many current nonrespondents. Also, in constructing longitudinal files from SIPP panels, the Census Bureau assigns zero weights to original sample members who missed only one or a few waves in addition to those who missed all or most waves.
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From page 416... ...
, in an exact match of the March 1986 CPS with IRS records for married couples with earnings, found that records with imputations for CPS earnings contributed significantly to the overall underestimate of wages and salaries in the CPS in comparison with the IRS tax returns. Thus, while mean CPS earnings in cases with no imputations were 98 percent of mean IRS earnings, mean CPS earnings in cases with imputations were only 89 percent of mean IRS earnings.
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From page 417... ...
found that the imputation of income in the 1984 SIPP panel for households reporting receipt of food stamps produced a larger proportion of such households with high monthly incomes that would make them ineligible for Food Stamp Program benefits than households that reported both their cash income and food stamps. Allin and Doyle (1990)
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From page 418... ...
carried out a record-check study that matched SIPP records in four states from the first two waves of the 1984 panel with records from eight state and federal programs (AFDC, food stamps, unemployment insurance, worker's compensation, federal civil service retirement, Social Security, SSI, and veterans' pensions and compensation)
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From page 419... ...
Aggregate Comparisons Aggregate comparisons of income estimates from SIPP and CPS, like comparisons of internal indicators of data quality, show a mixed picture. On balance, SIPP seems to be doing a somewhat better job of income reporting, but not for all income types.
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From page 420... ...
The remaining two-thirds difference, it is hypothesized, is explained by more complete reporting of income in SIPP for the lower end of the income distribution. In that regard, respondents to SIPP report more sources of income than respondents to the March CPS; they also report higher amounts for such income sources as Social Security, Railroad Retirement, SSI, unemployment compensation, veterans' payments, and child support payments, all of which are important to the low-income population.
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