Association for Public Policy Analysis & Management

Panel: Poverty and Inequality: Understanding and Addressing the Problems

(Poverty and Income Policy)

Poverty and inequality are timely and important economic policy problems. Compared to historical levels, poverty in the US grew with the Great Recession and remains high so that currently more than 45 million Americans – 14.5 percent of the population – live in poverty. Income inequality is also growing and, compared to other industrialized countries, the U.S. now has the highest levels of income inequality. These statistics are alarming because researchers have long known that poverty and inequality are transmitted across generations. Better understanding these phenomena and identifying innovative and effective policies will improve the life chances of disadvantaged children. This session explores poverty and income inequality, providing researchers and practitioners new insights into these problems. The session begins by measuring inequality in three different ways – income, consumption, and net worth – to determine the joint relationship between these measures to clarify our understanding of recent trends in inequality and economic well-being. Next, the session will examine the consequences of rising inequality for the low- and middle-income households by measuring how less affluent households respond to the rising living standards and consumption capability of the very richest. The study provides an in-depth analysis of the type and total amount of debt incurred by low- and middle-income households. The session then assesses two policies – one from abroad and one domestic – that seek to halt the intergenerational transmission of poverty and inequality. The first of these papers examines parental responses to a national policy in the United Kingdom that sought to address the unequal life chances of children caused by poverty and inequality by providing all children a child savings account, with larger public investments to lower income children. The second of these papers examines state policies to reduce child maltreatment – one determinant of later life poverty – by stopping the cycle of violence against children and linking families to services that may economically assist them. In doing so, the session will advance research informing our understanding of inequality and poverty, with a specific focus on how to improve the life chances of disadvantaged children.