Association for Public Policy Analysis & Management

Following decades of research, the Supplemental Poverty Measure (SPM) was developed in 2011 by the U.S. Census Bureau and Bureau of Labor Statistics (BLS), as an improvement to the official poverty measure. The SPM incorporates a more inclusive family definition, including additional resources (adding non-cash benefits and subtracting necessary expenses), as well as developing a quasi-relative poverty threshold adjusted geographically and by housing tenure status (renters and owners with and without a mortgage). Many researchers and practitioners have asked for alternative specifications of this threshold, with some researchers preferring an absolute threshold to allow better comparisons to the official poverty measure and others asking for a relative threshold to allow for international comparisons. This paper details the conceptual differences among relative, quasi-relative, and anchored poverty thresholds. This paper also develops and implements a series of anchored and relative thresholds and explores the impact of these alternatives on SPM poverty rates from 2009-2016. Finally, all taxes and government transfers captured in the SPM are subtracted from resources to assess the total impact of taxes and transfers on poverty rates.