A Budget-Based Definition of Poverty: With an Application to Single-Parent Families

Abstract

An approach to defining poverty through a Basic Needs Budget (BNB) is presented which takes account of families' differing needs for child care and transportation, and of regional differences in housing costs. Taxes and noncash benefits from governmental and private sources are also accounted for. The BNB poverty rate for single parents for 1989 is 47 percent, compared to 39 percent under the official method; almost a quarter of single parents holding full-time jobs are counted as poor under the BNB method. Radical reduction in both the welfare rolls and the poverty rate would require government assurance of child care and medical care to single parents.