U.S. Census Bureau
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Washington, DC 20233
Institutional Affiliation: U.S. Census Bureau
NBER Working Papers and Publications
|May 2019||The Use and Misuse of Income Data and Extreme Poverty in the United States|
with Bruce D. Meyer, Derek Wu, Victoria R. Mooers: w25907
Recent research suggests that rates of extreme poverty, commonly defined as living on less than $2/person/day, are high and rising in the United States. We re-examine the rate of extreme poverty by linking 2011 data from the Survey of Income and Program Participation and Current Population Survey, the sources of recent extreme poverty estimates, to administrative tax and program data. Of the 3.6 million non-homeless households with survey-reported cash income below $2/person/day, we find that more than 90% are not in extreme poverty once we include in-kind transfers, replace survey reports of earnings and transfer receipt with administrative records, and account for the ownership of substantial assets. More than half of all misclassified households have incomes from the administrative data...