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Income Data for Policy Analysis: A Comparative Assessment of Eight surveys

Publication Date

Income is a critical variable in policy analysis, and because of this, most federal household surveys collect at least some data on income. Yet income is exceedingly difficult to measure well in a household survey. Income questions produce some of the highest item nonresponse rates recorded in surveys, and comparisons of survey estimates with benchmarks developed from administrative records provide evidence of significant under-reporting for many sources. Mathematica Policy Research, Inc. (MPR) and its subcontractor, Denmead Services & Consulting, have conducted a comprehensive and systematic assessment of the income data and its utility for policy-related analyses in eight major surveys: the Survey of Income and Program Participation (SIPP); the Annual Social and Economic Supplement to the Current Population Survey (CPS); the American Community Survey (ACS); the Household Component of the Medical Expenditure Panel Survey (MEPS); the National Health Interview Survey (NHIS); the Medicare Current Beneficiary Survey Cost and Use files (MCBS); the Health and Retirement Study (HRS); and the Panel Study of Income Dynamics (PSID).

The assessment included both descriptive and empirical components. The descriptive component compiled extensive information on survey design and methodology in addition to the measurement of income and poverty and presented these data in a side-by-side format. The empirical component generated comparative tabulations of the distribution of income and poverty status for a range of personal characteristics for a common universe, income concept, and family definition, to the extent that this was feasible. Additional analysis focused on the implications of specific design choices. [416 PDF pages]