Trends in Economic Mobility and Poverty
Paper Session
Saturday, Jan. 4, 2025 8:00 AM - 10:00 AM (PST)
- Chair: Derek Wu, University of Virginia
Income Mobility among the Top One Percent
Abstract
Circulation into and out of the top one percent is higher in the U.S. than in other countries. One third in the top one percent of the tax-return income distribution fall out one year later, and two-thirds were no longer in the top one percent a decade later. Multi-year measures of income reduces the top one percent share. In recent years, top one percent shares over 5 years are 1.2 percentage points (6 percent) lower and over 21 years are 3.4 percentage points (16 percent lower). Annual and multi-year top wealth shares are more similar but are modestly lower using multi-year measures.Poverty Trends Over Two Decades Using Linked Survey and Administrative Data
Abstract
We examine the extent to which the United States has reduced poverty over time and the role that government programs have played. These are among the most important and highly contested issues in U.S. domestic policy. Unfortunately, existing estimates of poverty trends are biased because they rely on household surveys that have been shown to have pronounced income misreporting that has substantially increased over time. We address this problem by linking household survey data with an unprecedented set of administrative tax records and program data that cover most major transfer programs for over two decades – from 1995 through 2016. This provides the first ever evaluation of progress in reducing poverty (as well as deep, near, and relative poverty) over time in the United States using linked survey and administrative data. Using survey data alone, we find that the share of the full population in poverty fell by nearly half between 1995-2016 after correcting for bias in the inflation measure and including taxes and in-kind transfers in the income concept. Using linked survey and administrative data, we estimate the decline to be substantially greater. Notably, while survey data show effectively no change in deep poverty during this period, we estimate a large reduction in deep poverty. Starting from a pre-tax money income base, we show that the combination of income concept changes and corrections for measurement error yield the largest reductions in poverty for the elderly and children and the smallest reductions for single individuals. In ongoing work, we impute additional sources of administrative data to cover the entire nation and time period. This will enable, among other analyses, an accurate quantification of the poverty-reducing role of government transfer programs and tax credits that were especially important for low-income families during this time period.Trends in Poverty in the United States Using Absolute and Relative Full-Income Poverty Measures: 1939 to 2022
Abstract
In this extension of Burkhauser et al. (2024, Journal of Political Economy) we for the first-time evaluate progress in reducing absolute and relative full-income poverty in the United States for 1939-2022. We use our same post-tax, post-transfer measure of household income including in-kind transfers and the value of health insurance based on data from the Current Population Survey Annual Social and Economic Supplement for 1963-2022. But based on the seminal work of Chetty et al. (2017, Science) and Collins and Wanamaker (2022, American Economic Journal: Applied Economics) we extend our analysis back to 1939 using data from the Decennial Census corresponding to 1939, 1949 and 1959 by making a series of additional imputations to consistently capture our preferred full-income measures of poverty. In addition, we determine the degree poverty reductions have been achieved through increased market income or government transfers. We also estimate poverty and source of income trends separately for Black and non-Black individuals, given the War on Poverty’s emphasis on improving the economic outcomes of Black Americans.Discussant(s)
Marianne Bitler
,
University of California-Davis
Jonathan Fisher
,
U.S. Census Bureau
David Johnson
,
National Academies of Sciences, Engineering, and Medicine
Matthew Unrath
,
U.S. Census Bureau
JEL Classifications
- J6 - Mobility, Unemployment, Vacancies, and Immigrant Workers
- I3 - Welfare, Well-Being, and Poverty