Government Transfers and Poverty Alleviation among Older Adults in the United States from 2002 to 2014

Abstract

Studies have indicated government transfers greatly alleviate poverty among older Americans. Yet recent social policy changes were suggested to increase older Americans' fiscal insecurity. New evidence is needed to expand the evaluation of government transfers. Longitudinal Health and Retirement Study data from 2002 to 2014 were used. We computed individuals' poverty status both when household income included and did not include government transfers. Results indicated the poverty rate dropped dramatically when household income included government transfers. The poverty alleviation effect was significantly greater among people who were female, older, members of a minority group, having fewer years of education, residing in the South, and living in a bigger household. Evidence from this study solidified the overall poverty alleviation effect of government transfers in old age. Differential effects among various demographic groups could be attributed to their initial status and divergent political beliefs about who should receive government transfers.