Measures of Material Hardship: Final Report. Resource- and Income-based Poverty Measures


People experience subsistence poverty "if they do not have the resources which are deemed necessary to achieve a certain minimum level of consumption" (Ringen, 1995, p. 353). The official US poverty statistic is an example of such a subsistence, or resource-based, poverty measure. Specifically, this measure uses poverty thresholds to identify families with incomes too low to purchase basic necessities (Citro & Michael, 1995). These thresholds, originally developed by Mollie Orshansky of the Social Security Administration, are based on the cost of a minimum diet and a multiplier that accounts for other expenses. The thresholds are adjusted annually to reflect changes in consumer prices. Given the widespread use of the US poverty measure, most Americans have come to think of poverty in terms of an income-based definition.

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