Category Archives: Poverty

Labor, Poverty, and Power

Source: Cambridge Now Blog, September 3, 2020

Countries around the world are struggling with the economic repercussions of the pandemic, and the United States in particular has recorded levels of unemployment not seen since the Great Depression. While the CARES Act, passed by Congress and signed by President Trump in March, provided $600/week in supplemental income to some workers, this benefit lapsed at the end of July and no replacement program has been enacted, leaving millions in a state of housing and food insecurity. At the same time, states have made cuts or are considering steep cuts to Medicaid and other social safety programs precisely as need surges, with millions of Americans losing health insurance along with their jobs. A disproportionate number of those who are at risk are Black Americans and people of color who worked—or still work, in some cases, but at minimum wage—in industries without organized labor, which has also been in decline over the past several decades in the United States. Indeed, the precarious position of low-wage workers and the unemployed stands in contrast to legislation designed to protect businesses and employers—for example, a $25 billion bailout to the airline industry, or the GOP Liability Shield Bill, which would give employers sweeping immunity against Covid-19 related lawsuits brought by employees.

We spoke to several Cambridge University Press authors and editors about the legal, political, and historical factors that explain these converging crises and make low-income and unemployed Americans especially vulnerable. We also asked about connections between calls to end anti-Black racism and to reinvigorate organized labor, and, more generally, how anti-labor and anti-poor measures have exacerbated the systemic effects of racism.

Transgender Status, Gender Identity, and Socioeconomic Outcomes in the United States

Source: Christopher S. Carpenter, Samuel T. Eppink, Gilbert Gonzales, Volume 73 Issue 3, May 2020
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From the abstract:
This article provides the first large-scale evidence on transgender status, gender identity, and socioeconomic outcomes in the United States, using representative data from 35 states in the Behavioral Risk Factor Surveillance System (BRFSS), which asked identical questions about transgender status and gender identity during at least one year from 2014 to 2017. More than 2,100 respondents, aged 18 to 64 years, identified as transgender. Individuals who identify as transgender are significantly less likely to be college educated and less likely to identify as heterosexual than are individuals who do not identify as transgender. Controlling for these and other observed characteristics, transgender individuals have significantly lower employment rates, lower household incomes, higher poverty rates, and worse self-rated health compared to otherwise similar men who are not transgender.

Impacts of Public Health Insurance on Occupational Upgrading

Source: Ammar Farooq, Adriana Kugler, IRL Review, OnlineFirst, Published June 5, 2020
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From the abstract:
Using data from the Current Population Survey’s Merged Outgoing Rotation Groups, the authors examine whether greater Medicaid generosity encourages people to switch toward better quality occupations. Exploiting variation in Medicaid eligibility expansions for children across states during the 1990s and early 2000s, they find that a one standard deviation increase in Medicaid infant income thresholds increased the likelihood that working parents move to a new occupation by 1.6 percentage points or 3.3%. Findings show that these effects are larger for those below 150% of the poverty line and for married parents who were not benefiting from Medicaid prior to the expansions. In addition, findings indicate that Medicaid generosity also increased mobility toward occupations with higher average wages and higher educational requirements. This article contributes to the literature on job lock by showing that access to public health insurance not only increases employment and job switches but also encourages occupational upgrading.

Why is the American South Poorer?

Source: Regina S Baker, Social Forces, Volume 99, Issue 1, September 2020
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From the abstract:
While American poverty research has devoted greater attention to poverty in the Northeast and Midwest, poverty has been persistently higher in the U.S. South than in the other regions. Thus, this study investigates the enduring question of why poverty is higher in the South. Specifically, it demonstrates the role of power resources as an explanation for this regional disparity, yet also considers family demography, economic structure, and racial/ethnic heterogeneity. Using six waves (2000–2016) of U.S. Census Current Population Survey data from the Luxembourg Income Study (N = 1,157,914), this study employs a triangulation of analytic techniques: (1) tests of means and proportion differences, (2) multilevel linear probability models of poverty, and (3) binary decomposition of the South/non-South poverty gap. The comparison of means associated with the power resource hypothesis yields the largest substantive differences between the South and the non-South. In the multilevel models, adjusting for power resources yields the largest declines in the South coefficient. Binary decomposition results indicate power resources are the second most influential factor explaining the South/non-South poverty gap. Overall, power resources are an important source of the South/non-South poverty gap, though economic structure and other factors certainly also play a role. Results also suggest an important interplay between power resources and race. Altogether, these results underscore the importance of macrolevel characteristics of places, including political and economic contexts, in shaping individual poverty and overall patterns of inequality.

….Beyond these factors, this study focuses on the role of politics and policy via power resources theory (PRT). Here,power resources refer to class-based collective political actors, such as labor unions and parties, and the social policies they are able to institutionalize…

October 2019 pre-print version

Does Administrative Burden Influence Public Support for Government Programs? Evidence from a Survey Experiment

Source: Lael R. Keiser, Susan M. Miller, Public Administration Review, Volume 80 Issue 1, January/February 2020
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From the abstract:
Research indicates that administrative burden influences the behaviors and views of clients and potential clients of government programs. However, administrative burden may also shape mass attitudes toward government programs. Taking a behavioral public administration approach, the authors consider whether and how exposure to information about administrative burden embedded within eligibility‐based programs influences citizen favorability toward those programs. It is hypothesized that if information about the existing screening mechanisms is highlighted and made salient, this will lead to greater approval of eligibility‐based programs. This expectation is evaluated using a survey experiment that explores administrative burden in the Temporary Assistance for Needy Families (TANF) program. The evidence shows that being exposed to information about administrative burden increases favorability toward TANF and its recipients, though these effects are conditional on party identification. The results provide insight into a potential consequence of administrative burden, showing the way in which information regarding burden can shape citizens’ support for eligibility‐based programs.

Evidence for Practice
– Public managers in social welfare programs face challenges in gaining public support because of the stigma associated with these programs.
– The evidence suggests that giving the public information about program screening improves views toward welfare programs.
– Increasing awareness about program screening processes may be beneficial. However, public officials should consider potential trade‐offs, such as discouraging applications.

Why is the American South Poorer?

Source: Regina S Baker, Social Forces, Advance Access, December 12 2019
(subscription required)

From the abstract:
While American poverty research has devoted greater attention to poverty in the Northeast and Midwest, poverty has been persistently higher in the U.S. South than in the other regions. Thus, this study investigates the enduring question of why poverty is higher in the South. Specifically, it demonstrates the role of power resources as an explanation for this regional disparity, yet also considers family demography, economic structure, and racial/ethnic heterogeneity. Using six waves (2000–2016) of U.S. Census Current Population Survey data from the Luxembourg Income Study (N = 1,157,914), this study employs a triangulation of analytic techniques: (1) tests of means and proportion differences, (2) multilevel linear probability models of poverty, and (3) binary decomposition of the South/non-South poverty gap. The comparison of means associated with the power resource hypothesis yields the largest substantive differences between the South and the non-South. In the multilevel models, adjusting for power resources yields the largest declines in the South coefficient. Binary decomposition results indicate power resources are the second most influential factor explaining the South/non-South poverty gap. Overall, power resources are an important source of the South/non-South poverty gap, though economic structure and other factors certainly also play a role. Results also suggest an important interplay between power resources and race. Altogether, these results underscore the importance of macrolevel characteristics of places, including political and economic contexts, in shaping individual poverty and overall patterns of inequality.

The Costs of Being Poor: Inflation Inequality Leads to Three Million More People in Poverty

Source: Christopher Wimer, Sophie Collyer, Xavier Jaravel, Columbia University, Center on Poverty and Social Policy and London School of Economics, November 2019

From the summary:
It is widely recognized that income inequality has skyrocketed in recent decades. Incomes at the top of the distribution have grown rapidly, far outpacing income growth at the bottom. Recent research also shows that prices have risen more quickly for people at the bottom of the income distribution than for those at the top —a phenomenon dubbed “inflation inequality.” An implication of this new finding is that we may be under-estimating income inequality and poverty rates in the United States—two national statistics that rely heavily on the annual inflation rate as part of their calculation. In this brief, we utilize an adjusted inflation index that accounts for inflation inequality across the income distribution and re-estimate recent trends in poverty and income inequality from 2004 to 2018. Our adjusted inflation index indicates that 3.2 million more people are classified as living in poverty in 2018, and that real household income for the bottom 20 percent of the income distribution actually declined by more than 7 percent since 2004. These results show that inflation inequality significantly accentuates both the incidence of poverty and income inequality.

Do Targeted Business Subsidies Improve Income and Reduce Poverty? A Synthetic Control Approach

Source: Jacob Bundrick, Weici Yuan, Economic Development Quarterly, OnlineFirst, September 20, 2019
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From the abstract:
Interstate competition for economic development has led many states to adopt targeted economic development incentive programs known as deal-closing funds. Deal-closing funds allow state officials to provide discretionary cash grants to select businesses to attract and retain economic development projects. However, whether these targeted business subsidies increase prosperity in the local economy remains unclear. The authors use evidence from Arkansas’s Quick Action Closing Fund to analyze how effective deal-closing funds are at increasing incomes and decreasing poverty. Specifically, the causal effects of the Quick Action Closing Fund on Arkansas’s county-level per capita personal income and poverty rates are estimated using a synthetic control approach. The results largely suggest that the business subsidy program fails to increase incomes and lower poverty rates over the long term, at least at the county level. These findings should serve as a caution to policy makers who wish to improve incomes and poverty rates with targeted business subsidies.

Household Debt and Children’s Risk of Food Insecurity

Source: Mackenzie Brewer, Social Problems, Advance Articles, August 8, 2019
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From the abstract:
In the United States, almost one in six households with children cannot access adequate food for a healthy and active lifestyle. Although food insecurity disproportionately affects lower-income households, it remains unclear why some lower-income families are more vulnerable to food insecurity than others. Household unsecured debt, such as debt incurred from credit cards and medical bills, may be an unexplored financial constraint associated with food insecurity. Using data from the 2014 Child Development Supplement (CDS) of the Panel Study of Income Dynamics (PSID), I assess whether unsecured debt, by amount and type of debt, is associated with food insecurity among lower-income households with children (N=1,319). Results indicate that medical debt increases odds of household food insecurity even after accounting for key sociodemographic and economic risk factors, while no relationship exists between other forms of unsecured debt and food insecurity. Moreover, although liquid assets decrease the risk of household food insecurity and attenuate the harmful effects associated with unpaid medical bills, few households have enough liquid assets to mitigate the risks associated with medical debt. Efforts to prevent medical debt may be essential for eliminating food insecurity among lower-income households with children.